Oral Answers to Questions

CHILDREN, SCHOOLS AND FAMILIES

The Secretary of State was asked—

Educational Options (16 and 17-year-olds)

Barbara Keeley: What steps his Department is taking to provide a range of options for 16 and 17-year-olds when education and training becomes compulsory up to the age of 18 years.

Edward Balls: The Education and Skills Bill sets out our plans both to raise the compulsory participation age in education to 18, and to provide new options for young people alongside our new diplomas and enhanced advice and guidance. We will introduce a foundation tier for those not yet at level 2 and expand the range and number of apprenticeships, so that by 2013, 90,000 more young people will do an apprenticeship each and every year, compared with today.

Barbara Keeley: I thank my right hon. Friend for his reply. Apprenticeships are a key option for young people, but there is evidence of considerable gender bias. The male options that are taken up tend to be better paid and lead to higher qualifications. In fact, in Salford, Connexions found that 100 per cent. of young women took health and child care, but skilled construction apprenticeships were 100 per cent. male, so that bias is evident locally. What initiatives or extra steps can be taken to tackle that considerable bias in apprenticeships?

Edward Balls: My hon. Friend is quite right on that point. Across the country, 99 per cent. of apprenticeships in construction are taken by men, and in engineering, the figure is 97 per cent. In child care, however, the number of apprenticeships taken by women is 97 per cent., and in hair and beauty it is 91 per cent. The new national apprenticeship service must make a priority not only of expanding the number of apprenticeships but of ensuring that they are available to both men and women. Through taster courses, better advice and guidance, we must make sure that the opportunities that we are expanding are available to men and women across the widest range of careers.

Bob Spink: I very much welcome the 90,000 additional apprenticeships, but will the right hon. Gentleman tell the House what he is doing to make sure that there is proper workplace-based training for those new apprenticeships? What incentives will he give employers to ensure that those young kids get real experience on the job, as interns would if they came to work in the House?

Edward Balls: I am not sure whether interns or young employees always get on-the-job experience. On the point made by the hon. Gentleman, we will only include in the 90,000 those young people who have a contract of employment with an employer. It will not simply be people on a training scheme—they must get work with an employer, as well as structured training. If it is an apprenticeship, that will be done in a particular way, and that will be dealt with by the national apprenticeship service. If it is a full-time job, under our new legislation there will be one day of training a week for every young person doing more than 20 hours. The important thing is to make sure that there is proper structured training to a qualification and, at the same time, the kind of on-the-job experience that will help those young people to be ready to move on to a full career. I can guarantee that that is very much part of our thinking, not just on the apprenticeships programme, but on the new diplomas, which combine learning and the practical experience that the hon. Gentleman wants to see more of.

Geoffrey Robinson: We are very pleased indeed with the steps that my right hon. Friend has taken to raise the compulsory age of participation. To make that a success, however, we must greatly increase the number of apprenticeships throughout the system in a relatively short time. His proposals for a national apprenticeship service could play a key role, provided that we get the organisation, the relationship with local government and the financing right. Would he therefore be prepared to meet a group of us who are concerned about all those matters, so that we can discuss them with him and the key people on his side?

Edward Balls: I am very happy to meet my hon. Friend. He has a great deal of experience in these matters: when he was chief executive of Jaguar, the company offered an important apprenticeship programme. He has a lot to teach us all about how to drive work-based learning in society, and he is absolutely right that only by expanding apprenticeships and providing better advice and guidance, and by making sure that barriers to learning are addressed can we achieve our objectives in raising the participation age to 18. We have been careful: we have not said that the measures will come in tomorrow; we have given ourselves five years and 10 months to prepare, and we will use that time to make sure that the legislation genuinely delivers the revolution that we need, including the revolution in learning in the workplace, which he supports.

Nigel Evans: It is proper that we should give effective vocational education to young people, whether in colleges or on work placements. However, the Secretary of State will know the shocking statistics on how many people leave school who cannot even read and write properly. Will he give a guarantee that he will redouble his efforts so that nobody leaving full-time education at age 18 will be illiterate?

Edward Balls: I am redoubling my efforts and those of the Government; I am also putting in place substantial funding increases year on year to deliver on that. The hon. Gentleman's words and those of other Conservative Members would have more credibility if they had supported our investment in education rather than opposed it in the past 10 years. We will do more to make sure that every child does well at school and that at 11 and 16 they get the qualifications that they need. Our Every Child a Reader and Every Child a Writer programmes are there to give the personalised one-to-one support that is needed. I agree with the hon. Gentleman that the situation today is not good enough; but it is a hell of a lot better than it was 10 years ago, when we came into power.

Claire Curtis-Thomas: I was very pleased to hear what my right hon. Friend said about trying to ensure that more women get into apprenticeship programmes. However, has he reviewed the programmes that he has already established for older women? On that basis, does he have any words of comfort for organisations that would like to see more such schemes to ensure that more women access higher-paid jobs?

Edward Balls: My hon. Friend has great credibility, as someone who has practised lifelong learning throughout her life and who has shown that women can go in and become experts across the widest range of professions. I listen to her words very carefully. As she knows, we now have not one but two Education Secretaries in the Cabinet. The funding of apprenticeships to adult women is a matter for the Secretary of State for Innovation, Universities and Skills. I shall raise the issue with him; together, we are driving forward the revolution in apprenticeships that our country needs and I shall ensure that my hon. Friend gets a proper reply from him.

Tony Baldry: The first tranche of diplomas—in subjects such as construction, IT and engineering—are coming in this September and they are very welcome. Will the Secretary of State explain who is meant to be engaging with employers in our constituencies? Do the Learning and Skills Council or the sector skills councils make sure that as many small and medium-sized employers as possible get signed up?
	Secondly, will the Secretary of State in due course—

Mr. Speaker: Order. One supplementary question is fine.

Edward Balls: In the case of apprenticeships, the new national apprenticeship service will have teams around the country to drive the number of extra apprenticeships that we need for 16, 17 and 18-year-olds. At the moment, the issue of 16 to 19-year-old learners taking up diplomas and engaging with employers is taken forward by the Learning and Skills Council as part of the local consortiums for driving forward the take-up of diplomas, and we now have that in most parts of the country.
	In the next few weeks, we will publish a consultation on how to move the funding of 16-to-19 education to the local authority level. When local authorities are at the centre of the local funding partnerships, the issue will be their responsibility, although they will work closely with regional development agencies and sub-regional employer skills partnerships to make sure that employers are engaged in the widest possible way. Without the support of employers, we will not be able to make a success of the diploma scheme. So far, the employer reaction to our diploma programme has been very positive indeed.

Kelvin Hopkins: I strongly support the Government's policy in this area and their efforts to improve education at every level. However, the fact is that a significant proportion of young people, mostly low achievers, become alienated from school and education at a very young age, and that carries through into the teenage years. We are in stark contrast to some other countries in this respect. Will my right hon. Friend look carefully at ways of overcoming that alienation and demoralisation among young people? That would make the Government's policy for 17 and 18-year-olds much more successful.

Edward Balls: Our policy for compulsory education to 18 will first affect the young people who today are 10 and 11 at school. What will motivate them will not only be the support that they get from teachers and families, but whether the curriculum is motivating for them in the period up to age 16. That will determine whether they want to stay on in education or training after that. It is certainly true that we have a lower staying-on rate at 16 than other countries, although the rate has been rising. However, the reforms that we are putting in place to the curriculum at key stage 3 level, and our diplomas, are more likely to achieve the kind of mix of theory and practice that will engage young people.
	Sports colleges, for example, today have the fastest increase in results, including in English and maths, because they use the motivation of sport to get young people learning across the range of different subjects. That is a great success story for the Government and shows the way forward for other areas.

Youth Services (London)

Harry Cohen: What plans he has to fund youth services in (a) Leyton and Wanstead and (b) London in the next three years.

Beverley Hughes: In addition to funding that local authorities can choose to allocate to youth services from their own budgets, over the next three years London will benefit from direct investment from my Department of £226 million for Connexions services, £64 million for Positive Activities for Young People and £34 million for youth opportunity and capital funds. The corresponding figures for Redbridge and Waltham Forest local authorities combined are £13.9 million for Connexions, £3 million for PAYP and £2.1 million for youth opportunity and capital funds.

Harry Cohen: I very much welcome that answer, which shows the Prime Minister's and the Minister's commitment. Indeed, the Mayor of London is keen to put money into youth facilities as well. In London, those better youth facilities are very much needed to stop the drift towards gangs and gun and knife culture. Will the Minister ensure that the money is spent as intended and that some local authorities—for example, Conservative ones—do not siphon the money away from youth facilities?

Beverley Hughes: I thank my hon. Friend for his question and for his continued interest in ensuring that his local authorities invest in youth services. He is right to say that the Mayor of London has added £20 million to our money over the next two years to constitute a dedicated London youth offer. A relatively large proportion—about two thirds of the £679 million in the 10-year youth strategy—will be ring-fenced so that we can insist that local authorities spend that money in conjunction with young people themselves. It is important, however, that local authorities maintain and, if possible, increase their contribution to their youth services from their own area-based grants to continue to drive up improvements. My hon. Friend is aware that Redbridge local authority was judged to be inadequate for youth services and value for money, and it is important that he keeps monitoring it to ensure that it puts the money where it is needed.

David Evennett: The Government's strategy, "Aiming high for young people", is a worthy commitment, but it is rather vague. Will the Minister clarify what sort of places she envisages young people will be looking for in boroughs across London?

Beverley Hughes: If the hon. Gentleman is referring to the specific amount of money in "Aiming high for young people", which was £6 million and which was increased by a further £160 million in the children's plan for refurbished and new youth facilities—the capital part of that offer—we are very much open to local authorities working in conjunction with young people to come forward with ideas for what is needed in their areas. We want them to use the opportunity to work in partnership with voluntary organisations and with the private sector. I have seen some innovative projects putting youth facilities in place in which the private sector has come on board to provide not only money but expertise, motivation and leadership. There are excellent examples around the country, including in London, and we want the best practice to be emulated everywhere to get some really exciting places for young people.

Karen Buck: I very much welcome the additional money that the Mayor of London and the Government are putting into youth services. Does my right hon. Friend agree that when youth service investment is matched with extended schools, that can make a real difference to tackling antisocial behaviour and improving academic performance and attendance? Does she also agree that it is bizarre that youth services are often closed on the nights of the week, such as Fridays, when the demand is greatest and the need to get young people off the street is greatest? Will she work with local authorities to ensure that youth services are delivering when they are needed most?

Beverley Hughes: I thank my hon. Friend for that question. As she knows, I have been leading something of a campaign on this. We did some research in eight local authorities and discovered in a spot check that in none of them were youth facilities open on a Friday and Saturday. It is time that we got away from providing services that suit the hours of the people who want to work in them rather than those who need the services. As local authorities come forward with their plans for using this money, we will press hard to ensure that, conditionally, these places must be open at times when it makes sense for young people who want to use them.

Teenage Pregnancy

Sandra Gidley: What steps he is taking to tackle teenage pregnancy through the Every Child Matters agenda; and if he will make a statement.

Beverley Hughes: The teenage pregnancy strategy is based on the Every Child Matters principles of integrated working, early identification and prevention, and draws upon the best available international evidence on reducing teenage conception. Since we launched the strategy, there has been a steady decline in England's under-18 conception rate, and it is now at its lowest level for 20 years. However, as we discussed last week in an excellent Adjournment debate, that progress nationally masks a wide variation in progress between local areas. We have identified what is working in the best areas, and we are now pushing all areas to incorporate those lessons into their local strategies.

Sandra Gidley: The Minister mentioned a decrease, but she will acknowledge that there have been local increases—particularly in Southampton, which has been dubbed the teenage pregnancy capital of the south. Does she agree that many young people have unprotected sex after alcohol, and what is her Department doing to ensure that children realise that there is a clear link between the overconsumption of alcohol and unintended pregnancy? They may go home with more than a hangover.

Beverley Hughes: The hon. Lady is absolutely right. Alcohol contributes to a significant proportion of unwanted teenage pregnancies, which is why it is important that the strategy adopted locally by local authorities, primary care trusts, youth services and schools—all working together—addresses a comprehensive approach to young people. Those bodies must offer all the support they can in relation to alcohol and the other factors that make young people vulnerable.
	As I explained, although some areas are not doing well and need to do better, the areas that have done well have reduced their unwanted conceptions by up to 40 per cent. If all areas performed at the rate of the best 25 per cent., national progress would be double what it is at the moment. It is a comprehensive local approach, addressing all those factors, that makes the difference.

Hilary Armstrong: Will my right hon. Friend do what she can to encourage local authorities to aim their strategy at preventing first-time pregnancies? In my experience, too many strategies concentrate on young girls' second pregnancies, and we want to ensure that the first baby is prevented. I hope that she will encourage local authorities to use programmes that concentrate on that issue, including provisions to ensure that nurses work in those schools where early pregnancies are most prevalent.

Beverley Hughes: My right hon. Friend is expert in this area because she spent a lot of time in her previous position in the Cabinet Office striving for progress. She is absolutely right; about 80 per cent. of teenage pregnancies involve first-time mothers. It is right that we address that matter in every way we can, and it is also right that schools play their part in a clear way by providing, where appropriate and with the agreement of governors and parents, good advice centred on young people, on school sites where necessary. That includes sexual health advice, as well as other advice relating to young people's problems.
	However, it is also important that we address second pregnancies because it is a really serious failure when 20 per cent. of teenage pregnancies are second or subsequent pregnancies involving young women who are still teenagers. If services cannot capture women who have already had a baby, and help them to avoid a second or third, they need to do a lot better.

Tim Loughton: The Minister is right to talk about integrated working, but she has no reason for complacency. If the Government have done so much on sex education, why did the UK Youth Parliament reveal that almost half of teenagers rate their sex education lessons as "poor" or "very poor"? The World Health Organisation said that more children in this country have sex than those anywhere in Europe, and there has been an alarming 43 per cent. increase, not in second pregnancies, but in the number of children having abortions for the second time. If everything is going as well as she claims, why has her Department halved the number of staff in its teenage pregnancy unit? Does that not show that the Government's 2010 target for halving teenage pregnancies is another failed ambition?

Beverley Hughes: I really welcome the hon. Gentleman's indication that he supports much more systematic, rigorous and consistent sex and relationship education in schools. Frankly, that is not the message we get from many of his hon. Friends.
	In relation to the teenage pregnancy unit, the focus is now on local areas. We cannot command strategies from the centre. Having developed the strategies and given local areas the tools they need, we need only a small team at the centre. We need local areas to improve their focus on and investment in local activity because we will make the difference there, not through command and control from Whitehall.

Holocaust Education

Gordon Banks: What assessment he has made of the contribution of the Holocaust Educational Trust's nationwide Lessons from Auschwitz project to teaching of the holocaust in the national curriculum.

Edward Balls: More than 1,500 students have now had the opportunity to visit the concentration camps at Auschwitz-Birkenau as a result of the work of the Holocaust Educational Trust and to build on the learning that they have received through the national curriculum about the horrors of the holocaust and the lessons that we should learn from it. I can announce today that we will allocate £4.65 million for the next three years to ensure that that work can continue. I can also reassure my hon. Friend that a proper evaluation of the funding on those trips, as well as of their impact on young people's citizenship and their understanding of the world, will be built into the HET's work as part of that three-year funding.

Gordon Banks: I thank my right hon. Friend for that welcome answer. I have visited Auschwitz-Birkenau with school pupils from my constituency, and I stress to my right hon. Friend the importance of urging the devolved regions of the UK to put funding in place, too. Will he do that whenever it is appropriate? Will he also take this opportunity to dispel the rumour that the holocaust will be removed from the curriculum, for which my right hon. Friend is responsible?

Edward Balls: On my hon. Friend's first point, I have not had the opportunity to go on one of those trips although my hon. Friend the Minister for Schools and Learners has. In my constituency, I ran a competition in which young people had to write an essay and the prize was to go on one of the trips. I have seen first hand, as has my hon. Friend the Member for Ochil and South Perthshire (Gordon Banks), the great impact that such trips can have, not only on those young people but on the whole school when they report back about the horrors that they saw. Our young people are learning lessons about tolerance and mutual respect for 21st century Britain from those visits.
	I hope that all the constituent parts of the UK will use the funding available. The £4.65 million for England clearly has Barnett consequentials in this area for the devolved countries. I hope and expect that they will ensure that such visits are available for all young people across the four constituent parts of the UK.
	As for my hon. Friend's final point, let me take this opportunity to dispel that internet myth. The teaching of the holocaust is compulsory in the national curriculum for all young people at key stage 3 and it will remain a compulsory part of teaching in the national curriculum under this party—and I am sure that it would remain so under all parties in this House. The holocaust is an issue that must be learned about, studied and reflected on by all our young people. It will stay in the national curriculum.

Louise Ellman: I am pleased to be a council member of the Holocaust Educational Trust, and I commend the Government for their support for this important programme. The incident at the King Fahad academy shows that anti-Semitic messages of hate are still circulating in our schools. What steps is my right hon. Friend taking to deal with that important issue?

Edward Balls: The fact is that bullying and any other kind of exploitation of difference, whether that happens on racial, religious or gender grounds, is wrong. Schools have a duty to act to stamp it out. That includes that particular school. Like all schools, it should take action when necessary. We have an inspection regime that is designed to ensure that that guidance on schools' obligations is put into action. My hon. Friend the Minister for Schools and Learners has raised the issue with the inspectorate. We will consider the issue carefully when we see the results. Bullying of any kind, including anti-Semitic bullying, is wrong and should not be tolerated in a society such as ours.

Foreign Languages

Simon Hughes: In how many primary schools a modern foreign language is taught.

Jim Knight: Research carried out in 2006 found that 70 per cent. of primary schools are teaching languages. That figure is up from 44 per cent. in 2003. The hon. Gentleman will know that I visited Surrey Square junior school in his constituency last December to see the excellent language teaching that goes on there. I am sorry that he was unable to join me on that occasion, and I look forward to his next question.

Simon Hughes: Southwark has a very good record of about three quarters of our primary schools teaching modern languages. Given that there has been a genuine increase in primary schools teaching modern languages, but that the number of pupils in England studying modern languages in secondary schools up to GCSE has dropped below 50 per cent., and that we are genuinely short of modern language teachers, how will we ensure that we have enough qualified teachers to give the interest and expertise at primary level that lead our youngsters to do modern languages at secondary level, too?

Jim Knight: On the day that I visited Surrey Square junior school, I also announced a 20 per cent. increase in funding for language learning. Part of that is to continue the initial teacher training in specialist language learning for primary schools. We have trained an extra 3,000 primary school teachers in language learning in the past three years. We need to continue that as we build up to the compulsion that we announced for primary language learning in the children's plan, which comes into effect from 2011.

Patrick Cormack: Would the Minister accept that the alarming illiteracy figures suggest that the one language that is not necessarily taught as rigorously as it should be in schools is English?

Jim Knight: No, I would not accept that. I am sure that the hon. Gentleman accepts that the number of young people leaving primary school and reaching the national standard in literacy and numeracy has increased by 100,000 a year. I am sure that he welcomes that improvement.

David Taylor: Small primary schools with small teaching staffs often cover widespread responsibilities and areas of the curriculum. In smaller schools, French may be pushed to the periphery. Will the Minister tell the House whether, in small primary schools, French is less likely to be taught, and whether there is an underlying problem with the future of small primary schools in this country on the scale that press coverage in the past seven or 10 days suggests?

Jim Knight: My hon. Friend will have noticed that I am extremely enthusiastic, in the light of such press coverage, to stress that small, especially rural, primary schools should explore the potential of federation. Nowhere is that needed more than in increasing language specialism in primary schools. The ability of primary schools to come together under a federation not only saves money through allowing them to share perhaps a head teacher, but enables them to share specialist teachers, such as language teachers, and tackle the problem.

Nick Gibb: The Minister has given the global figures for modern language teaching in primary schools. However, is he not worried about the report from the National Foundation for Educational Research, which reveals that, for each year group at key stage 2, only half of primary schools provided foreign language teaching and only a third provided it for all year groups at key stage 2?

Jim Knight: Obviously, we examine in detail what the NFER tells us about its research—it is a reliable research organisation—as we continue with our strategy. However, the overall figures speak for themselves. The hon. Member for North Southwark and Bermondsey (Simon Hughes) last asked the question in 1990, when the Conservative party was in power. Then, only 20 per cent. of primary school students were learning a modern foreign language. The trend is undoubtedly in the right direction.

Unaccompanied and Trafficked Children

Anthony Steen: If he will take steps to prevent unaccompanied and trafficked children from going missing while in local authority care.

Kevin Brennan: The Government take that issue very seriously and we are therefore taking steps to address it. Existing statutory guidance for local authorities about children going missing from care applies regardless of immigration status. Last week, we published proposals to improve services for unaccompanied asylum-seeking children, including better procedures for identifying and supporting the victims of trafficking.
	In December, we published specific guidance, "Safeguarding Children who may have been trafficked". That includes action for local authorities and all practitioners who work with children to take when potentially trafficked children enter care to protect them from further exploitation.

Anthony Steen: Since local authority safe houses are anything but safe, hundreds of unaccompanied asylum-seeking children go missing each year because the provisions are insecure and it would not be acceptable to lock them up. Will the Under-Secretary ensure that children trafficked into the main London airports and those elsewhere in this country do not go to local authority care homes and safe houses close to the airport, because the traffickers know that that happens? They wait in cars outside those homes to pluck the children out of them within hours of their being placed there.

Kevin Brennan: I pay tribute to the work that the hon. Gentleman does in this area. He is quite right: it is a problem that trafficked children can go missing from care, often returning to those who trafficked them. He is also right to identify the problem of keeping them secure. He may be aware that the Border and Immigration Agency published its response to the public consultation exercise last week. One of the measures announced was a response to exactly the point that the hon. Gentleman made; in other words, there is a need to place unaccompanied asylum-seeking children in a network of specialist local authorities, to ensure that they receive the expert services that they need.

Gwyneth Dunwoody: But are those local authorities going to be given the support that they need to ensure that they can keep tabs on the children concerned? It is an absolute disgrace in the 21st century that children who are at such risk cannot receive that support from the United Kingdom.

Kevin Brennan: Yes, and my hon. Friend is quite right to describe the trafficking of children as an absolute disgrace. As I mentioned earlier, the Home Office published the results of its public consultation exercise last week, which include better procedures to assess the age of children, ensuring that adults and children are not accommodated together, and putting in place better procedures to identify and support asylum-seeking children who are the victims of trafficking, while paying particular attention to those who are at risk of going missing or suffering further harm or exploitation.

Engineering

Ashok Kumar: What steps his Department is taking to promote engineering as a career amongst 14 to 16-year-olds; and if he will make a statement.

Jim Knight: We are funding a new communications campaign to provide advice on subject choices and careers in science and engineering, and to dispel narrow stereotypes about engineers. We are supporting activities to excite young people about engineering, such as the science and engineering after-school clubs, which will double in number to 500 by September, while the new style of teaching and learning delivered by the new diplomas from September should attract significant numbers into engineering from the age of 14.

Ashok Kumar: I am very happy to hear what my hon. Friend has said, but is he aware of the recent study carried out by the Royal Academy of Engineering, "Public Attitudes to and Perceptions of Engineering and Engineers", which found that young people were least aware of what engineering is all about? I am happy that he is making such efforts to promote engineering in schools, but will he monitor the situation closely, because we do not want to be in the same situation in a year's time?

Jim Knight: My hon. Friend is an effective champion on the issue in the House, and I know that he takes a great interest in the future of engineering. We will certainly continue to monitor things. He is right that the survey to which he referred showed that young people felt that they knew little about engineering or what engineers do. The reality is that engineering covers a wide range of interesting careers, including music, electronics and space. I hope that our communications campaign will open up young people's eyes to the exciting world that he champions so well.

Joan Ryan: My hon. Friend might be aware that Enfield has a long and proud history in engineering. I recently met north London employers, who told me that they have trouble attracting good-quality candidates into engineering. The view of an engineer as someone who wears a boiler suit, has an oily rag and is themselves covered in oil is the one that predominates. Really good careers advice is needed to reflect what the profession is actually about. Ensuring that young people have a true vision of engineering through good vocational education is also crucial, so I am pleased to hear what the Minister has said. I, too, hope that he will monitor progress on the matter.

Jim Knight: We certainly will. Last week I announced £140 million of spending on science, technology, engineering and maths-related issues, which underlines the significance that we place on them and is also a doubling of the funding over the previous three years. The points that my right hon. Friend made about careers advice and work-related learning are correct. I am sure that she applauds the work that we are doing to develop diplomas and, as part of that, to improve careers education. Indeed, there are measures in the Education and Skills Bill, which is currently in Committee, that address all those things.

Anne Moffat: Further to those questions and answers, I welcome what the Minister has said. Does he agree that it is vital that specialised engineering skills should be taught in schools as early as possible, particularly in the light of our decision to go ahead with new build in the nuclear industry? We are very short of engineers in that field.

Jim Knight: It is because we are responding to employer demand, including in the area that my hon. Friend has mentioned, that we have focused so doggedly on the STEM subjects. I am confident that, as the strategy rolls out, the cross-government focus with our ministerial colleagues in the Department for Innovation, Universities and Skills, the Treasury and the Department for Business, Enterprise and Regulatory Reform will enable us to respond to the skills needs of employers up and down the country.

A-level Examinations

Andrew Rosindell: What plans he has for the future of the GCE A-level examination; and if he will make a statement.

Jim Knight: A-levels are long-established and valued qualifications. Their future should be decided not by any pre-emptive Government decision, but by the demands of young people and schools. We have said that, in 2013, we will review the evidence and experience following the introduction of all 17 of the new diplomas to see how the range of post-16 qualifications meets the needs of young people and supports their progression into further study and employment. We will consider the future of A-levels in the light of that evidence.

Andrew Rosindell: Before going down the road of the Government-introduced A-level-style qualifications to be offered by companies such as McDonalds, Flybe and Network Rail, does not the Minister think that we should tackle the root problem of the failure of literacy and numeracy, particularly among school leavers? The problem was highlighted in a recent CBI survey.

Jim Knight: We have made clear gains in literacy and numeracy, both at primary and secondary level, as I was saying to the hon. Member for South Staffordshire (Sir Patrick Cormack) earlier. That does not mean that we should be complacent, however. We need to make further improvements pre-16 in order to make the post-16 options work, particularly as we introduce compulsion as part of the Education and Skills Bill. The accreditation of employers' own training for qualifications has been welcomed by the Opposition as a sensible step forward in raising the value of employer-based training.

Nick Gibb: Does the Minister share our concern that too many sixth-formers in comprehensive schools are being poorly advised on their choice of A-levels, and that the admissions director at Cambridge university says that their opting for softer subjects "essentially rules them out" of Cambridge? If the Minister shares our ambition of getting more state sector pupils into Oxford and Cambridge, what measures is he taking to ensure that bright sixth-formers study the meatier academic subjects to prepare them for the top universities?

Jim Knight: We simply do not accept that some A-levels are harder or softer than others. Indeed, in 2004 we commissioned the Independent Committee on Examination Standards—chaired by Dr. Barry McGaw, the director of education at the OECD—to look into A-levels. The committee's report concluded that no examination system at school or any other level anywhere in the world was as tightly or carefully managed as the A-level. We are also establishing a new regulator, who will continue to monitor the standard of the A-level to ensure that it is well respected by all our higher education institutions.

Children of Separated Parents

Andrew Selous: What steps his Department is taking to provide relationship support and services to children of separated parents.

Kevin Brennan: The children's plan contains a commitment to improve support during and after family breakdown, including helping children to maintain contact with both parents. My Department promotes strong families and seeks to minimise the impact of breakdown on children. Families can access services via children's centres and extended schools. We fund marriage and relationship support through grants, and the Children and Family Court Advisory and Support Service—CAFCASS—safeguards and promotes the best interests of children in family court proceedings.

Andrew Selous: The Children's Commissioner for England has said that the most important cause of unhappiness in children is the threat of family breakdown. Will the Government therefore look sympathetically at the family relationship centres in Australia, which have bipartisan support and help parents to reach agreement on post-separation parenting? They also do a lot to strengthen intact family relationships and marriages.

Kevin Brennan: I know that the hon. Gentleman is very keen on the Australian model and that he has long taken an interest in that subject. I am sure that that has nothing to do with the fact that he had an Australian mother. The Legal Services Commission has recently finished piloting the family advice and information services, known as FAINS. These are aimed at encouraging the development of a more holistic approach, including clients working with their solicitors to develop a personal action plan to identify the actions that the client and other agencies will take, and the support that the client will need, in addition to that of a solicitor. So there is already a FAINS pilot in place, and we will evaluate it in the near future, perhaps before we go on to consider the hon. Gentleman's preferred native solution.

School Buildings (Battersea)

Martin Linton: What plans he has to rebuild and refurbish schools in Battersea.

Jim Knight: All secondary schools in Wandsworth, including two in Battersea, will be modernised under Building Schools for the Future. Wandsworth's proposals are for Battersea technology college to undergo a major rebuild with some refurbishment, and for Salesian college and John Paul II school to become one new Roman Catholic school, located in new buildings on the current Salesian site.

Martin Linton: I thank my hon. Friend for that assurance. Will he ensure that the building starts first in those two schools given priority in the Wandsworth bid, which also happen to be the most improved secondary schools in the borough, having improved their GCSE scores from five to 60 and 18 to 67 respectively?

Jim Knight: I certainly congratulate those schools on their excellent results. We will monitor extremely carefully how the £250 million indicatively pledged to Wandsworth will be spent under Building Schools for the Future and I will remain in touch with my hon. Friend, who continues to lobby me hard on ensuring that we achieve best value for money and that standards continue to rise for the young people in his constituency.

Topical Questions

David Taylor: If he will make a statement on his departmental responsibilities.

Edward Balls: This morning, I put before the House a written statement on progress in respect of 14-19 diplomas. In addition to setting out that UCAS is recognising that the advanced diploma will be worth three and a half A-levels, Leeds university is announcing that it will accept the construction and built environment diploma for entry to its civil engineering course, and Newcastle, Southampton, Sheffield, Warwick, Nottingham and Liverpool are all announcing that they will accept the engineering diploma—and, indeed, the chair of the 1994 group of universities is confirming that all its members will accept the diploma—the written statement confirms that more than 800 schools and more than 150 colleges will be offering diplomas from this September. It also sets out a regional breakdown, area by area, for Members of the House, and estimates that from September 2009, two thirds of secondary schools and three quarters of colleges will be offering diplomas as part of their curriculum.

David Taylor: We hear from the Opposition routine and vacuous charges of a continuing widespread decline in academic standards at GCSE level, which can be swiftly and confidently rebutted for almost every subject—save GCSE mathematics, which is widely recognised as a totally inadequate preparation for almost all higher education courses. Can the Secretary of State reassure the House that he will respond positively and rapidly to last Friday's concerns of the advisory committee on mathematical education that those otherwise welcome new diplomas, to which he has just referred, could worsen an already most unsatisfactory mathematical position for future students and future employers?

Edward Balls: I can. May I say how pleased I was that my written statement bore some relation to my hon. Friend's topical question T1 — [Interruption.] Or, indeed, vice-versa.
	On the issue of diplomas, I can first assure my hon. Friend that functional maths is a core part of every stage of every diploma. Secondly, Geoff Parks, admissions tutor at Cambridge university, said in a public statement before Christmas that he believed that the mathematical part of the engineering diploma would be a better preparation than the maths A-level for engineering at Cambridge. I share the concern to ensure that our maths curriculum and maths teaching is of the highest quality, which is why the Williams review is currently looking into the teaching of maths at primary school. We will ensure that, in mathematics as in all other aspects, diplomas are not viewed as a gimmick, or second-class, or only vocational, but as truly world-class excellent qualifications. That means in mathematics, too.

Robert Goodwill: I am sure that Ministers are aware of the struggle undergone by many parents of children with special educational needs to secure statements for their children. However, once secured, a statement is applicable to only one local education authority, which is particularly frustrating for armed forces parents, who are regularly posted around the country. Will Ministers consider, if not the situation more generally, the possibility of making such statements portable?

Edward Balls: The Defence Committee's inquiry also raised this issue, and I shall discuss with colleagues in the Ministry of Defence how we can do more to increase portability. That does not mean that when armed forces personnel go abroad they will be able to carry the statements with them, which would be a more complex process, but we should be able to make re-entry easier, and I assure the hon. Gentleman that I will discuss that with my MOD colleagues.

Lynda Waltho: I was pleased to hear about increased and continued funding for holocaust education, as was my hon. Friend the Member for Ochil and South Perthshire (Gordon Banks). Last year I was privileged to accompany a group of Dudley pupils to Auschwitz-Birkenau, and I have witnessed their work since then. I know that they have learnt much more than facts and figures about the holocaust. They have learnt about intolerance, victimisation, and how ordinary people can do extraordinary things in the face of adversity. Will my hon. Friend ensure that that opportunity is widened beyond students of history? It is very much part of the citizenship education programme, and should be made available to all pupils.

Jim Knight: My hon. Friend is right: the Holocaust Educational Trust, led so ably by Karen Pollock, does a fantastic job in organising not only the trips themselves, but the preparation for them and the work that takes place afterwards. My hon. Friend is also right to say that holocaust education of this kind is not purely about history, important though it is in the context. It has significant citizenship effects, and it also helps to combat bullying. We have problems with homophobic bullying and bullying of people with Gypsy or Romany background, as well as anti-Semitic bullying. If young people can understand where that can lead to, they can learn a significant amount from history.

David Laws: The Secretary of State knows that the future of some 2,500 primary schools across the country has been put in doubt by the guidance issued by his Department in December. If the Government really believe in localism, can he tell us why the money that is to be distributed for the building of new primary schools in the future should be conditional on the taking of 125,000 surplus places out of capacity?

Edward Balls: It is not. Let me take this opportunity to lay that claim to rest. Once again, a Liberal Democrat press release has proved to be very misleading. On page 25 of the guidance, we say that we want local authorities to take
	"decisive...early action to ensure that no school has more than 25 per cent surplus places".
	We say this as well:
	"It is also accepted that in order to preserve access for young children, there may be more empty places in schools in rural areas than in urban areas".
	We are absolutely clear about the fact that there is a presumption against closing rural schools. Of course, given that resources for local authorities are increasing, it is essential for budgets to be managed properly through collocation of services, through federations and through school budget managers. Local authorities can take a number of measures to avoid the closure of small schools. The idea that we have set out in guidance a plan to close 2,500 schools is simply wrong, and I am happy to put the record straight.

Gordon Marsden: What can the Government do to improve educational provision for young people over 16 with special educational needs? There is a new Disability Discrimination Act code for post-16 providers, but given that the Connexions service is being transferred to local education authorities without guaranteed ring-fencing, can the Government ensure that that will result in improved rather than reduced information, advice, guidance and support for young people over 16 with disabilities?

Kevin Brennan: Yes. Our initial impact assessment is that the code has greatly influenced the quality of provision. It has raised the level of awareness required; it has also improved the sector's provision for young people with special educational needs, and the way in which it discharges its duties and responsibilities. Nevertheless, we realise that much remains to be done if we are to achieve the target of true equality.

Michael Gove: Last week, the Department gave the Association of Muslim Schools, a group of independent Islamic faith schools, a new right to establish its own separate inspection arrangements, and according to its own website, the association has also received £100,000 in Government funding. But the association's deputy chair, Mr. Ibrahim Hewitt, the head of the Al Aqsa school in Leicester, is on record as saying that
	"the word integration doesn't even belong in a true democracy".
	He has also called
	"political zionism a threat to world peace",
	and said of
	"zionist control of the media"
	that there is no smoke without fire. He has objected to Holocaust memorial day, and he is the UK chairman of Interpal, an organisation under investigation by the Charity Commission following a "Panorama" examination of its links with Hamas. Against that background, does the Secretary of State not think that we need to be more, rather than less, rigorous in policing the growth of separatist Islamism in education?

Edward Balls: Of course we do, and that is why the inspectorate the hon. Gentleman mentions will itself be inspected by Ofsted and come under the tough rules in the Bill now before the House. It is revealing that when we published our children's plan in December, the hon. Gentleman did not make a single reference to any of the issues raised in it, and also that, although he is now publishing his own children's plan, he does not raise the issue of children's policy in the House. That shows what his priorities are.

Michael Gove: I am disappointed by the Secretary of State's partisan tone on this serious issue. We have faced the problems that I have described before. The King Fahad academy, which the hon. Member for Liverpool, Riverside (Mrs. Ellman) referred to, has used textbooks that describe Christians and Jews as pigs and monkeys, and Ofsted has acknowledged that it did not study the details of all the textbooks concerned. Indeed, of 606 visits by inspectors to Muslim faith schools, only 94 have been made public. The Chairman of the Children, Schools and Families Committee has pointed out that we just do not know what is being taught in many Muslim schools. What steps will the Secretary of State take to ensure that we have proper inspections by independent figures who are fluent in the relevant languages and aware of the ideological challenge posed by separatist Islamism?

Edward Balls: That is what our legislation is doing, and the Ofsted oversight of all inspection is the right way to achieve it. We cannot have different rules for different schools; they must all come under one legislative framework. On the instances raised of particular problems in recent months, we have taken action, and so has Ofsted; where action needed to be taken, it was taken. That is what independent inspection is all about. As I have said, it is very revealing that on the day that the hon. Gentleman publishes a flimsy document on children's policy, he and his colleagues have made no reference to it whatever.

David Kidney: What support does the Department provide for families when a baby is born, and what affordable plans does it have to continue such support in future?

Beverley Hughes: What we are learning through the work that the Government are doing is that we cannot support the most disadvantaged mothers with a quick burst of support in the first week after a baby is born, as has been suggested today—particularly if we also cut maternity grants to pay for it. In contrast, the family nurse partnerships will start working with first-time mothers when they are pregnant and stay with them until the child is two years old, if necessary, to make sure that the most disadvantaged children really do get the best possible start in life.

Andrew Selous: I have seen that the most successful primary school in the country requires its parents to read to children. I am the literacy governor of Studham lower school in my constituency. Does the Secretary of State think that giving home school contracts more strength might be part of how we could encourage that practice more widely?

Edward Balls: The most successful primary school in key stage 2 tests at age 11 is in Salford, and I visited it only two weeks ago. Its head teacher stresses the importance of every child being read to every day in school, and also the important role parents play in supporting their children's reading. That is why all Members should use this national year of reading to encourage all parents to read to their children from the earliest age. I do not necessarily think that that should be put in a contract; every parent should be doing it from birth. I want to encourage that to happen, but I am not sure whether legislating for it is the right way to achieve it.

Mark Harper: The Secretary of State will know that in answer to the Select Committee's report on special educational needs, the Government said that they would set up an expert group under the chairmanship of Brian Lamb to look into increasing parental confidence in the system. Does that group have any timetable to come back to the Government with proposals, or is the commitment open-ended?

Edward Balls: We set out our intention to ask Brian Lamb, who, as the hon. Gentleman knows, is an acknowledged expert in this area, to examine the issues raised in the Select Committee report. We will publish written terms of reference and a timetable for his work in due course. We are doing this partly to examine best practice across the country, but also because experts on different sides of the debate have different views about the best way to approach statementing. We decided that rather than rushing to a conclusion, the right thing to do was to ask an expert to examine the matter. That is what we will do, and we will set the timetable in due course.

Andrew Robathan: May I take the Secretary of State back to employer-sponsored diplomas, which I am sure we all think are an interesting and valuable step forward? What genuine independent assessment will be made of such diplomas, so that McDonald's, or whoever is involved, will not be selecting students for our top universities—or, indeed, for Keble college, Oxford?

Edward Balls: The introduction of the McDonald's qualification has been widely welcomed; it has been welcomed not only by the hon. Member for Surrey Heath (Michael Gove) but by the CBI, which has said:
	"Today marks a significant milestone on the road to reforming qualifications so that they better reflect the skills and competencies employers and employees need. Flybe, McDonald's and Network Rail deserve recognition for trail blazing this initiative and making it easier for companies wanting to follow in their footsteps."
	The CBI is supporting us, as is the chairman of the Federation of Awarding Bodies. The independent standards regulator that we are setting up will ensure that higher standards are maintained and employers' needs are also met. It is the Labour party that will ensure that the training needs of employers continue to be met.

Ashok Kumar: May I tell the Secretary of State that 3,395 children in Middlesbrough benefit from free nursery education? What sort of future support can he provide? May I also invite him to visit Middlesbrough to see this great success for himself?

Beverley Hughes: I thank my hon. Friend for that question, and for his support for the development of early years learning that the Government are putting in place. He will know that Middlesbrough is a pilot area for extending the free entitlement to two-year-olds. We can also expect the extension to 15 hours to take place there from September, as we progressively develop the support and the options available to parents of young children. I shall happily come to Middlesbrough to see what is going on there.

Speaker's Statement

Mr. Speaker: The House will be aware that I made a statement on Thursday indicating that I had summoned an urgent meeting of the Members Estimate Committee for today. In the debate on the fourth report of the Committee on Standards and Privileges that afternoon, several Members expressed deep concerns about Members' allowances. Similar anxiety about the audit system has been relayed to me privately, and we must also take fully into account the public interest in transparency. At this afternoon's meeting of the Members Estimate Committee, we will be discussing urgently how to proceed on these matters. The subject of Members' allowances is something that the House itself must determine, but it is clear that the Committee must find an effective and acceptable solution as quickly as is practicable. It has always been my practice to inform Members first, so I shall be writing to every Member of the House following today's Committee meeting, announcing how the matter will be taken forward.

HMP Woodhill (Inquiry)

Jack Straw: With permission, Mr. Speaker, I should like to make a statement. As the House will be aware, there appeared in  The Sunday Times yesterday allegations that conversations between my hon. Friend the Member for Tooting (Mr. Khan) and a constituent of his, Mr. Babar Ahmad, detained in prison on an extradition warrant, had been subject to covert recording when my hon. Friend visited Mr. Ahmad on two occasions in 2005 and 2006 at Her Majesty's prison Woodhill.
	I was made aware of the burden of these allegations on Saturday afternoon. My right hon. Friend the Home Secretary and I discussed the matter and we agreed that an immediate inquiry should be established. In a statement to  The Sunday Times issued on my behalf early on Saturday evening I announced this, and expressed my concerns about the allegations, if true.
	It may assist the House if I now give some detail of the differing ways in which the statutory authorisation regimes for intercept, and for intrusive surveillance, operate. But just before I do so, let me underline the fact, drawn from my experience as a Minister directly involved in these matters over many years, that no authorisations are granted unless by law they are necessary for the detection or prevention of crime or the protection of national security or for related matters, and are proportionate, and unless the information concerned cannot be obtained by other means. Any authorisation for the interception of telephone calls and other public telecommunications requires a warrant personally signed by the relevant Secretary of State—usually the Home Secretary in respect of the police, Security Service and other domestic law enforcement agencies, and the Foreign Secretary in respect of the Secret Intelligence Service and GCHQ. Such a Secretary of State warrant is also required for surveillance operations—including eavesdropping—where sought by the three intelligence agencies. The telecommunications regime is overseen by the interception of communications commissioner—normally a retired member of the senior judiciary, currently Sir Paul Kennedy. This is laid down in the Regulation of Investigatory Powers Act 2000—known as RIPA. Surveillance under this regime is overseen by the intelligence services commissioner under the Intelligence Services Act 1994.
	Under the 2000 Act, the regime in respect of intrusive surveillance operations by the police and other domestic law enforcement agencies is different. Under these provisions, which originated with the Police Act 1997, passed in the closing months of the previous Administration, with our support, there is a hierarchy of approvals depending on the nature of the surveillance concerned. In the case of eavesdropping operations, authorisation by a chief officer of police or officer of equivalent rank in the Metropolitan Police Service is required. This regime is supervised by the chief surveillance commissioner—currently Sir Christopher Rose, formerly a senior judge of the Court of Appeal. Ministers play no part in these authorisations.
	Where any operation involves the use of premises of HM Prison Service, neither the Prison Service nor the Minister concerned is asked for any additional authorisation for the particular operation. What the Prison Service is asked for, on the basis of a brief summary, is permission to conduct the operation, and that judgment by the Prison Service is based on whether any order or control issues arise, not on the merits of the authorisation itself.
	The story in  The Sunday Times related to claims in respect of an alleged operation sought by and authorised by the police. It follows that this matter falls within the regime supervised by the chief surveillance commissioner. I can now announce to the House that, with the agreement of my right hon. Friend the Home Secretary, the chief surveillance commissioner, Sir Christopher Rose, has agreed to conduct an inquiry with the following terms of reference:
	"To investigate the circumstances relating to the visits to Babar Ahmad at HMP Woodhill by Sadiq Khan MP in May 2005 and June 2006, to establish whether the visits were subject to any form of surveillance and if so by whose authority and with whose knowledge, and to report his findings to the Prime Minister, the Home Secretary and"
	to me as
	"the Justice Secretary."
	The inquiry will of its nature be fact-finding. Sir Christopher has told me that his aim is to conduct the inquiry as quickly as possible, but consistent with the thoroughness required. He says that he will do his best to complete his task within two weeks. A further statement will be made to the House once we have received and have been able to consider his findings.
	It may assist the House if I mention two other matters. The first is the Wilson doctrine. This, as the House knows, was originally promulgated by the then Prime Minister, the late Harold Wilson, in 1966, when he said that he had given instructions that there was to be no tapping of the telephones of Members of Parliament, and that if there were a development that required a change of policy he would, at such a moment as was compatible with the security of the country, make a statement about it. The terms of that statement have been endorsed by successive Prime Ministers, including by Tony Blair in a written ministerial statement to the House on 30 March 2006. In a written answer on 12 September 2007, my right hon. Friend the Prime Minister said:
	"The Wilson Doctrine applies to all forms of interception that are subject to authorisation by Secretary of State warrant."—[ Official Report, 12 September 2007; Vol. 464, c. 2103W.]
	Secondly, the question has been raised about interception of, or surveillance of, conversations with any person—whether a suspect, a convicted criminal or otherwise—by their legal adviser. Those are all subject to explicit safeguards which generally prohibit such interception or surveillance.
	Mr. Speaker, I commend my statement to the House.

David Davis: I thank the Justice Secretary for advance sight of the statement. Indeed, I thank him for coming to the House rapidly to make the statement. Today he has told us what should happen—not what did happen. He has confirmed that the Wilson doctrine remains in force and that there have been no changes in process or practice, given the duty under the doctrine to notify the House of any such changes. I think he also confirmed that the alleged action—if it happened—was in breach of the spirit of the doctrine. By now he should be able to answer the question: who authorised this? Was it a Minister? Was it a policeman? If a policeman, at what rank was it authorised? Is there any truth in the rumours that appear to have been briefed to Nick Robinson of the BBC at lunchtime today?
	More generally, in what ways did the authorities fail to follow proper procedure? Were the breaches of the applicable protocol accidental, or a deliberate and pre-meditated short-circuiting of the system? In particular, was it known in advance that a Member of Parliament would be bugged, and if so, was an explicit decision made not to switch off the recording equipment? Was higher authorisation sought before making that decision?
	Clearly, there will be lessons to learn from this case, but can the Justice Secretary tell the House what the current arrangements are for ensuring compliance with the rules for authorising such recording of communications with MPs? What failures in the monitoring and review procedure allowed recordings of a Member of the House—made, we understand, in 2005 and 2006—to go unchecked for, in some cases, two and a half years? Those are all things that the Justice Secretary should be able to tell the House today. Others will take longer.
	The Government will need to establish whether this is an isolated case or whether other Members of Parliament have been bugged in the past. Everyone in the House understands and accepts the privileged nature of communications between a Member of Parliament and a constituent. Everyone, including the Prime Minister and the Justice Secretary, accepts the almost absolute nature of that privilege. I say "almost" absolute because the question arises: what would happen if a Member of Parliament became implicated in some way in actions or communications relating to a terrorist plot? The Wilson doctrine is silent on that.
	The inquiry that the Justice Secretary proposes might consider that issue, and after it has concluded, the Prime Minister should consult the Leader of the Opposition and other Opposition parties and return to the House on the matter. Given the security interests involved, the discretion required and the importance of sustaining public and parliamentary confidence in the system in place, I welcome the proposed independent review, but I believe that as far as possible the full report should come to the House, not just to Ministers.
	The case has exposed two very serious risks. The first is that it is possible for the Executive to ride roughshod over the relationship between a Member of Parliament and his constituents—a relationship that is the very basis of parliamentary democracy. Secondly, the necessary authorisations for secret anti-terrorist activity may be being ignored. Wilson himself recognised that there is a "delicate balance"—his words—between the needs of security and democracy. It is the duty of Government to find and maintain that balance—and it is the job of the Justice Secretary in the next two weeks to re-establish that balance.

Jack Straw: I thank the right hon. Gentleman for the manner in which he has responded to my statement, particularly his welcome for the independent inquiry by an extremely distinguished and experienced former senior member of the Court of Appeal.
	The right hon. Gentleman asks me a series of questions. I made it clear in my statement that the allegations relate to claims in respect of an alleged operation sought and authorised by the police, and I set out the nature of authorisations in respect of such intrusive operations, which come under that part of the 2000 Act. I also said that we do not know whether the allegations are true, but we do, however, know the nature of the allegations and what is alleged. In so far as there was an authorisation of anything in this area, no Minister plays any part in such authorisations. I repeat that for the avoidance of doubt.
	As for the right hon. Gentleman's other specific questions, I hope that he will accept that although they are entirely legitimate questions, for certain, they are now properly questions for Sir Christopher Rose. He will conduct his inquiry thoroughly but swiftly. He has allowed me to say that he hopes to complete it within two weeks. That is a very acceptable time scale for the House. Of course we understand the public and parliamentary interest in this matter.
	The right hon. Gentleman also refers to the Wilson doctrine. I spelt out the nature of that doctrine—and as for any implications for the Wilson doctrine, I think it best if we wait until we have the result of the inquiry by Sir Christopher Rose.

Keith Vaz: I join the shadow Home Secretary in thanking the Lord Chancellor for coming to the House to make the statement, and for launching the inquiry, which was his decision, with the Home Secretary, and was not done at the request of my hon. Friend the Member for Tooting (Mr. Khan). Will the Lord Chancellor say to Sir Christopher that if he wishes to make any recommendation concerning the Wilson doctrine it can be considered in the future, but that it is absolutely vital that he stick to the timetable of two weeks?

Jack Straw: I thank my right hon. Friend for what he has said. On the time scale, I have already said that Sir Christopher will carry out the inquiry as quickly as possible, consistent with the thoroughness required. He hopes to be able to complete it within two weeks—I believe that he almost certainly will—but I hope that the House will accept that if there is a balance between speed and thoroughness, thoroughness must be the priority.

David Heath: I am grateful to the Lord Chancellor for his statement. I welcome the inquiry that he has launched, and I hope that, unless the systems are entirely dysfunctional, the audit trail will be clear and unambiguous. Is it not the case that these events have added piquancy because they took place in one of Her Majesty's prisons, and because Mr. Babar Ahmad was held on an extradition request from the United States, under the US-UK extradition treaty, for alleged actions that may or may not have happened on British territory?
	The Lord Chancellor has implied that the Wilson doctrine is to be upheld by the Government, and there are good reasons for doing that, but does he agree that there may be a need for a restatement of the doctrine, given the ambiguities in the current arrangements, in differing levels of warrantry for various intercepts, and the fact that the doctrine can be set aside, and that fact will not be announced if the Prime Minister feels that it is in the national interest not to announce it? Is there now a case—I think that this was proposed as long ago as 2003 by my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith), the Chairman of the Justice Committee—for authorisation for all intercepts on Members of this House to be taken at a high level by an independent judicial authority, such as the Lord Chief Justice?
	What specific actions have been taken since March 2006, when Sir Ian Blair admitted recording conversations with the then Attorney-General, Lord Goldsmith? Does the fact that protocols are apparently not understood by senior police officers not undermine the safeguards offered and enacted on the ever-expanding surveillance activity in this country, and underline the need for vigilance, which the House should exercise, in response to any further extension of intrusive surveillance powers?

Jack Straw: On the issue of an audit trail, Sir Christopher Rose will obviously wish to examine that matter, and I do not want to anticipate his findings. The hon. Gentleman referred to the Wilson doctrine. I understand the point that he was making, but I repeat for the benefit of the House that if there are any implications for the Wilson doctrine, it is best that we wait until we have the result of the Rose inquiry.
	The hon. Gentleman also referred to a recording—I think that this is a matter of fact—made by the Commissioner of Police of the Metropolis of one phone call with my right hon. and noble Friend Lord Goldsmith, who was Attorney-General at the time. That was an entirely separate matter, which as far as I know did not come under any of the regimes that we are discussing, because it was a recording made by one party to a telephone call of the other party's conversation. The commissioner has already explained what happened in that case.

Phyllis Starkey: Woodhill prison is in my constituency, and many people who work there are my constituents. They do a job of great complexity, as the prison has a wide range of prisoners, including some who are high security risks. Will the Lord Chancellor assure me that the inquiry will be handled in such a way as to minimise any destabilisation of the work done by prison officers and staff during that period?

Jack Straw: Yes is the answer to that question, and in answering it I pay tribute to the prison officers and other staff of all grades at Her Majesty's Prison, Woodhill, as well as those throughout the Prison Service, who are dedicated and professional and do an extremely difficult job very well indeed.

Richard Shepherd: The Justice Secretary said that the allegations first came to light on Saturday. This is Monday. Surely it is possible between Saturday and Monday to ascertain whether someone has been bugged, and what authorisation was given for the bugging. That is the general "bugging" question. Surely it is also possible to determine whether the bugging, if it did occur, took place in the presence of a Member of Parliament. I am concerned that we are drowning in inquiries on almost every subject under the sun, and I am concerned about the time that they take. Yet we are to have more inquiries, when here, technically, the question of what happened that Saturday is something that the right hon. Gentleman can answer.

Jack Straw: I can answer about my own state of knowledge on Saturday afternoon, which I have already explained. I do not think that it is quite fair to suggest that my right hon. Friend the Home Secretary and I have not acted with speed. As soon as we understood the nature of the allegations, which was late Saturday afternoon, my right hon. Friend and I discussed the matter and agreed that an independent inquiry should be established. That was announced in a statement that evening to  The Sunday Times. I suggest that we could not have acted with greater speed, and that the appropriate way to behave if one is setting up an inquiry is to ensure that it has proper terms of reference and that there is an individual who has accepted the invitation to run it, and then to make a statement to the House. It would have been impossible to make this statement any earlier than I have.

Gavin Strang: Does my right hon. Friend agree that there are circumstances in which the authorities can legitimately bug a detainee, and that such surveillance need not be suspended when the detainee meets a Member of Parliament? However, I put it to him that the Wilson doctrine, which has served this country well and which protects Members of Parliament from eavesdropping by the state, should not be eroded.

Jack Straw: On my right hon. Friend's second point, there was wide approbation across the House when the then Prime Minister, Tony Blair, explained in a written ministerial statement in March 2006 that, notwithstanding proposals emanating from the interception of communications commissioner, he had come to the view, widely shared by all Members, that the Wilson doctrine should continue. As for the regime, the Regulation of Investigatory Powers Act 2000 lays down detailed regulations governing the use of those powers and the level at which they can be authorised, as well as proper oversight by commissioners who are always former senior members of the judiciary.

Douglas Hogg: It would seem as if something has happened that should not have happened, so there is a risk that other things that should not have happened might have happened. Can the terms of the inquiry be enlarged so that Sir Christopher Rose has an opportunity to identify whether, at Woodhill or anywhere else, conversations between prisoners on remand and their legal advisers have been recorded? If they have, not only is the integrity of the criminal justice system at risk, but individual convictions will be prejudiced and will probably have to be set aside. Sir Christopher would do well to examine, too, the question of whether private conversations with legal advisers have been recorded, whether at Woodhill or at other prisons.

Jack Straw: The inquiry is specifically into the allegations that have been made in respect of our hon. Friend the Member for Tooting. I repeat to the right hon. and learned Gentleman and to the House that on the subject of legal professional privilege—in other words, conversations between any individual, whatever their circumstances, and their legal adviser—specific rules are laid down in codes of practice and in non-statutory form, which, as I said, generally prohibit not only the interception or surveillance of such conversations but any accidental recording that takes place thereafter. To my certain knowledge, as a former Home Secretary and Foreign Secretary, those rules are rigorously enforced, and there is a careful audit of all interceptions and the use of those powers by the relevant commissioners.

Andrew MacKinlay: Is it not the case that Swinton Thomas wanted the Wilson doctrine to be abandoned, because he knew that it had been broken and flouted over many years? Is not the problem that the Wilson doctrine has no statutory basis whatever, so it should be put on such a basis? The Home Secretary in a statement admitted to, or referred to, Parliament's failure to have oversight of the security and intelligence services. When will the Government provide for Parliament to have oversight of those services, as is the case in all other leading parliamentary democracies? At present, the scrutineers are hand-picked by the Prime Minister. Unacceptable.

Jack Straw: I know that that is my hon. Friend's consistent view. We have introduced for consultation the question whether the basis of the Intelligence and Security Committee should be changed, but I remind him that in any event, the basis of the ISC's authority is not a quixotic decision by the Prime Minister or by any of his predecessors, but a thorough decision made by the House and the other place in statute in the Intelligence Services Act 1994.

Sarah Teather: Hon. Members in all parts of the house sometimes deal with constituency cases that are highly sensitive. The Secretary of State will be aware, because he has met me on a number of occasions, that I represent two men who have been in Guantanamo Bay. Is he confident that the case that we are discussing is an isolated incident? Can he give any assurance to my constituents that their conversations with me remain confidential, and that they have not at any stage been overheard by the security services?

Jack Straw: It is always a logical impossibility to prove a negative, but this is the first time that I can recall such an allegation being made. I repeat that the regime in respect of all those authorisations is an extremely careful and thorough one, laid down in law by the House and the other place in the very thorough 2000 Act. If any individual has any suspicion that there has been an unauthorised interception of their communications or surveillance of their activities, there are clear routes for making a complaint, including a complaint to the tribunal itself.

Frank Cook: If my right hon. Friend was unaware of the issue and the Prime Minister had no knowledge of it, may I ask my right hon. Friend to assure the House that he will extend the inquiry's terms of reference to include how a prominent member of the Opposition Front-Bench team could claim that he had written a letter to the Prime Minister in December giving forewarning of the issue? Will that be part of the inquiry?

Jack Straw: I shall certainly draw my hon. Friend's remarks to the attention of Sir Christopher Rose. I simply repeat what has already been said: the right hon. Member for Haltemprice and Howden (David Davis) has said and put on the record that he sent a particular letter, although the text of that letter makes no reference to the names of any individuals. The right hon. Gentleman has confirmed that.
	It is also a matter of record that Downing street has checked all its files and records on the receipt of letters, and although there have been a number of communications from the right hon. Gentleman, this was certainly not one. I say on my behalf and that of my right hon. Friend the Home Secretary that we also knew nothing whatever of the letter until we were informed about it through the media by the right hon. Gentleman.

Pete Wishart: Can the Lord Chancellor confirm that Members of the Scottish Parliament and all the other devolved institutions are not covered by the Wilson doctrine? If that is the case, does he not believe that MSPs should be given the same protection as MPs when it comes to having their conversations bugged?

Jack Straw: What the hon. Gentleman says is correct, and it is spelt out by Sir Swinton Thomas's report for 2005-06, in which he raises the question of whether the Wilson doctrine should be abandoned. Decisions about interception warrants in respect of police operations in Scotland are a matter not for any UK Secretary of State, but for the Scottish Executive.

Diane Abbott: The Lord Chancellor's statement appears to suggest that there is one regime for telephone tapping, another regime for bugging by policemen and another for bugging by members of the security services. When the inquiry is concluded, will he consider one protocol that covers all those circumstances in relation to Members of Parliament so that at the very least to bug or tap the telephone of an MP will require ministerial approval? In that way, our constituents—many of whom come to us as frightened, vulnerable or fearful individuals—could have some security that they were speaking to us in complete confidence.

Jack Straw: As I pointed out in my statement, there are indeed three separate regimes; that is the position as the House and the other place accepted it for reasons that I could go into but will not detain the House on. As far as the implications for the Wilson doctrine are concerned, I think it best if we wait until the results of Sir Christopher Rose's inquiry.

Richard Ottaway: Does the Secretary of State consider that the Wilson doctrine applies to Members of Parliament who have not taken the Oath?

Jack Straw: The Wilson doctrine applies as stated.

Dennis Skinner: I congratulate the Secretary of State on introducing this inquiry. Will he also do us—especially those of us in the focus group on this Bench—a favour? Will he extend the inquiry to beyond a fortnight? It will certainly need it if it looks into the allegations of MPs and trade union leaders being bugged in the strike of 1984 and 1985. That was when the Thatcher regime was in power. Despite all the protestations from many of us present in the House today, that regime would not have an inquiry—and we did not send one letter; we sent many scores of them.

Jack Straw: This is a matter of history, because it is the first time that my hon. Friend has ever admitted to being a member of a focus group, although I have heard him on many occasions express opinions about them and say that he would never touch one with a bargepole.
	I note what my hon. Friend has to say. I think that it is correct that the Interception of Communications Act 1984, the original statutory provision that laid down a proper statutory procedure for telephone intercept—not for other matters at that stage—probably did not come into force until quite late in that year. It was only introduced following an adverse decision in a case—the Malone case—in the European Court of Human Rights. Before that—it was a matter of considerable concern to many people, including me—the regime for telephone tapping was a non-statutory one operated in what we would now regard as unusual circumstances.

Julian Lewis: Notwithstanding the brevity of the Lord Chancellor's answer to my hon. Friend the Member for Croydon, South (Richard Ottaway), will he expand a little on what the Wilson doctrine actually requires? It clearly requires that an MP should not be targeted for bugging or for telephone tapping. However, is it the case that if the security services are legitimately bugging or tapping the telephone of someone who is a legitimate target for them, the moment that person is found to be talking to a Member of Parliament, the bugging or telephone tapping has to cease, or is it allowed to continue because the MP himself or herself was not being targeted?

Jack Straw: I am sorry to have to repeat what I said in my statement, but the terms of the Wilson doctrine are as laid down by the then Prime Minister, the late Harold Wilson, who said that he had given instructions that there was to be no tapping of the telephones of Members of Parliament and that if there were a development that required a change of policy, he would, at such a moment as was compatible with the security of the country, make a statement about it. That doctrine has been endorsed and repeated by successive Prime Ministers.

Jim Devine: Can my right hon. Friend reassure me and my constituents that there are no phones in this place or in our offices that are bugged and monitored by British security services?

Jack Straw: Under the 2000 Act, as under its predecessors, it is not possible to give answers as to whether a warrant is currently in force. However—let me repeat what I have said before people's imaginations run away with them—the only circumstance in which a warrant for interception can be authorised personally by a Secretary of State is for reasons of national security or for the prevention or detection of crime or related matters, and only, too, where that is shown to be both necessary and proportionate and information cannot be gained by any other means. I also say to my hon. Friend that in my experience over nine years of having to sign warrants as Foreign Secretary and as Home Secretary, enormous care was taken by the requesting agencies and by the Departments concerned, and not only by me as Secretary of State but by my colleagues, to ensure that all aspects of the spirit as well as the letter of the law were observed before a warrant was signed.

David Howarth: I know that the Secretary of State does not want to talk about the consequences of this case for the Wilson doctrine, but could he at least put on record his support for the reasons behind the doctrine, which include the apprehension that surveillance on Members of Parliament could be used for political purposes, either for the purposes of the Ministers concerned or—this was Harold Wilson's own fear—for the political purposes of the security services and the police?

Jack Straw: I am happy to do that, and I made my position very clear in my statement on Saturday. I could not have been clearer. I also say to the hon. Gentleman, touching on the point raised by my hon. Friend the Member for Bolsover (Mr. Skinner), that the situation that arose in the mid-1960s and continued for quite a period afterwards is very different from today's situation, and that of at least the past two decades.
	I should also point out an error, for which I apologise. The Interception of Communications Act was passed in 1985, which makes my point more strongly. As we now know, in those days, there was quite widespread surveillance of individuals, to do with national security and the cold war, and related matters involving the trade unions. It would be impossible to say these days that such individuals would come within the narrow terms of the Regulation of Investigatory Powers Act 2000. Things have changed.

Rob Marris: I thank my right hon. Friend for his prompt action and his statement. In reply to an earlier question, he confirmed that in certain circumstances, and subject to a code of conduct, communications between a prisoner and his or her lawyer could be eavesdropped on. Would he expand in a little more detail on why the rules should be different for Members of Parliament?

Jack Straw: I said that they could not be eavesdropped on, with great respect. There are different rules for different categories of sensitive information. Some are to be found in the codes of conduct, which are laid down under subordinate powers of the 2000 Act, and others are to be found in statements to this House, including the Wilson doctrine.

Bill Wiggin: Will the first question that Sir Christopher Rose asks be: "Was Mr. Babar Ahmad bugged, and if he was, who kept the records?" If it was the Home Office, why is the Home Secretary not doing this statement?

Jack Straw: I am afraid that I cannot anticipate the first question that Sir Christopher Rose asks, and neither can anyone but he. As far as the matter of which Secretary of State should be making the statement is concerned, I am making it because the allegations relate to surveillance in one of Her Majesty's prisons, for which I am responsible.

Bob Spink: In view of public sensitivities and their disconnection from this Parliament, is it not time for the Home Secretary to ensure that an independent Law Officer, not a politician, makes the decision on intercepting the communications of MPs? Would it not be a good idea always to put national security and the fighting of major crime before our own sensitivities?

Jack Straw: The hon. Gentleman's latter point was made by Sir Swinton Thomas. He made a case for removing the Wilson doctrine, but it was not accepted. As far as the different regimes are concerned, they have all been considered quite recently. On the latest occasion, between 1999 and 2000, they were considered in the Regulation of Investigatory Powers Act. The House accepted, without a great deal of argument, that there should be different regimes in respect of intercept, surveillance by intelligence and security agencies and surveillance by the police. Of course, in the future, it is open to any Government and to this House to review the way in which those regimes operate.

Mark Pritchard: Will the Secretary of State give an undertaking to the House that part of the review will consider independent, third-party intelligence agencies from outside this country, and the relationship, if any, that they had with the original request for the intercepts?

Jack Straw: I cannot give that explicit undertaking because the hon. Gentleman appears to suggest that he has knowledge which I do not have. I repeat that Sir Christopher's inquiry, within the terms of reference, will be as thorough as all of us who know him would expect and believe.

Peter Bone: The Lord Chancellor has answered our questions carefully and fully, but will he tell me whether he is aware of any MP's conversations being intercepted during the past 10 years?

Jack Straw: I apologise to the hon. Gentleman; I cannot answer that question because it would literally be a criminal offence to do so under the 2000 Act, which was passed by the Commons and the other place without argument. I cannot give any details of whether an individual is subject to interception.

Crispin Blunt: If Members of Parliament are discovered by our security services to be under surveillance conducted by overseas intelligence services, is it the case that those Members are alerted—and if not, should it be?

Jack Straw: That is a matter for further consideration. I take note of what the hon. Gentleman said.

Points of Order

John Spellar: On a point of order, Mr. Speaker. Have you received a request from the Leader of the Opposition to clarify his remarks during Prime Minister's questions last week, when he alleged that the previous Conservative Government had kept an individual—Mr. al-Qaradawi—out of the country, when in fact we know that he had been let in about half a dozen times? Have you received such a request, and if so, would you—

Mr. Speaker: Order. That is not a matter for the Chair.

Gwyneth Dunwoody: On a point of order, Mr. Speaker. You will be aware that on Thursday last week, during business questions, the right hon. Member for North-West Hampshire (Sir George Young), following a Liaison Committee meeting, mentioned the change that was proposed at extraordinarily short notice to the way in which this House scrutinises European legislation. You will also be aware that we are frequently criticised for the superficiality of the role that we play in scrutinising European legislation. I am therefore somewhat surprised to discover on the Order Paper for today not only that a timetable has been attached to that business, but that, despite the mollifying words of the Leader of the House on Thursday, it would appear that we are going ahead with no consultation with either the Liaison Committee or the Committee concerned.

Mr. Speaker: Is the hon. Lady referring to motion 4 on the Order Paper?

Gwyneth Dunwoody: I am, Sir.

Mr. Speaker: The fact of the matter is that the hon. Lady can oppose the motion. If it is taken after 10 o'clock, it will be nod or nothing, but before 10 o'clock the hon. Lady could speak to it.

Peter Bone: On a point of order, Mr. Speaker. Immediately after a statement, it is very useful for hon. Members to be given a copy of what the Minister has said. Unfortunately, the copy that I received today had the last part of the statement missing. Can that be looked into?

Mr. Speaker: It will be looked into.

Police Grant

Tony McNulty: I beg to move,
	That the Police Grant Report (England and Wales) 2008-09 (House of Commons Paper No. 265), which was laid before this House on 24th January, be approved.
	The focus of today's debate will be the police funding settlement for 2008-09. However, I am pleased to tell the House that, in the context of a tight financial settlement, we have secured a good and affordable funding settlement for the police service for each of the next three years, building on considerable investment over a sustained period. The gradual move to three-year police funding settlements has been widely welcomed by the police and by police authorities and will enable them to plan more effectively and to think in the longer term.

Andrew Robathan: Will the Minister give way?

Tony McNulty: No, I will not. I want to put things into context and I shall then spend a not inconsiderable time giving way, because there are clear local interests. However, I would like to introduce the context first, if I may.
	Government grant and central spending on services for the police will have increased by more than 60 per cent.—nearly £4 billion—between 1997-98 and 2010-11. That is a record of which we can be proud. Our investment over the past decade, as well as the significant investment from local taxpayers and the delivery by police forces and authorities of substantial increases in efficiency, has helped to expand local policing, reduce crime and make our communities safer.
	Figures published on 24 January show that crime in England and Wales remains stable, according to the British crime survey, and that it has fallen by 9 per cent., according to the police recorded crime statistics. The risk of being a victim of crime, which is 23 per cent., has returned to its lowest level since the survey began in 1981. The police service has responded well to the many and varied demands placed on it. New challenges continue to arise and we must ensure that the service is in the best possible shape to meet them.
	The House will know that we see Sir Ronnie Flanagan's review of policing as an opportunity for wider debate about how best we can consolidate and build on progress and achievements to date, support the police as they meet new challenges and make the most of their collective talents and resources. As part of that process of wider consultation and review, as well as responding to Sir Ronnie's findings and recommendations, we intend to publish a Green Paper in spring 2008. The purpose is to consult on wider proposals for strengthening the framework that enables and supports the police service and its partners to deliver effectively for the public in the years ahead.

Andrew Robathan: Let me take the Minister back to his comments about proposals being widely welcomed. I attended a meeting the Friday before last at Leicestershire constabulary headquarters. I believe that the Chairman of the Home Affairs Committee visited in the afternoon because there were two meetings. The police authority and the chief constable told us categorically that, far from welcoming the proposals, they were deeply worried about the cuts that they would have to make in, for example, child abuse investigations. There is already a near freeze on police recruitment. The crime situation in Leicester city is not a happy one and the police are worried that they will have to cut services protecting the public because of the grant. Will the Minister comment on that?

Tony McNulty: I will. The broader context of the settlement has been welcomed. Some people believed that it would not be as generous as it has been. Chief Constable Matt Baggott and others in Leicestershire are doing a very good job. Casting even the remotest aspersions on them about what they may have to cut is unhelpful.

David Heath: Forces such as Avon and Somerset are worried about the persistence of the damping mechanism, which means that we never catch up with the needs-based assessment. When will it be possible to fund police forces such as Avon and Somerset at the level that is required?

Tony McNulty: Let me say, as gently as I can, that the hon. Gentleman's comments are rather churlish, given that the average increase this year was 2.7 per cent., the floor was set at 2.5 per cent. for those that would lose out from the formula, and Avon and Somerset received 3.5 per cent., putting it in the top category of authorities. However, I take the broader point, however churlishly put, that, having established a formula of need, the sooner we reach the new formula, the better. Having been static, with a narrow range between the ceiling and the floor, we were able this year at least to announce a settlement that had no ceiling. Some progress has therefore been made towards the formula and I hope that, in the coming years, it will continue, if not accelerate somewhat.

Gwyneth Dunwoody: I hope that my right hon. Friend will not accuse me of churlishness. As the recipient of a 2.5 per cent. increase, my county has been presented with enormous difficulty. We want to invest in policing. Is he determined to stick to the settlement? It will produce enormous stresses and strains in the policing system in Cheshire.

Tony McNulty: I would never accuse my hon. Friend of being the least bit churlish. I hope that those matters will be explored further when, this Wednesday or Thursday, I meet the chair and chief constable of Cheshire to discuss their specific problems in much more detail. I hope that they will elaborate on their plans. However, the settlement is broadly welcome.

Several hon. Members: rose —

Tony McNulty: I balked at allowing hon. Members to intervene straight away because I knew from the last couple of debates on the subject that they naturally wish to consider their own areas. I fully understand that. I got a little way ahead.

Mark Pritchard: rose—

Tony McNulty: I said at the start that, given the localised nature of the debate, I wished to be as generous as possible to Back Benchers, and I will be.  [Interruption.] I was last year, as the hon. Member for Bury St. Edmunds (Mr. Ruffley) reminds me. However, it is also my role to get a bit of the context on the record. I will be generous.

Keith Vaz: The response of the chief constable of Leicestershire was that he welcomed the settlement, but he rightly emphasised that he needed more to fulfil Leicestershire's ambitious plans.
	I want to ask my right hon. Friend about Kent and the letter that he may have received from Mike Fuller, the chief constable. Has that letter had any impact on decisions that the Home Office may need to make about funding formulae? I refer to migration, which Mike Fuller mentioned.

Tony McNulty: The straightforward answer to my right hon. Friend is no, in the context of the three-year horizon projected by the settlement. Kent and other forces have raised similar matters—Julie Spence, the chief constable of Cambridgeshire, raised the same issue as Mike Fuller in Kent—that, to be fair, do not necessarily go to the notion of migration and criminality being linked. However, there are genuine concerns about increasing levels of population and about how the Government formula allocations can be quite tardy in picking them up. There are discussions across Government about the matter, not least those with my right hon. and hon. Friends in the Department for Communities and Local Government about growth areas, the sustainable communities plan and all those directions, although they have not directly impacted upon the issue that my right hon. Friend raised.

David Howarth: Precisely on that point, the problem in Cambridgeshire seems to be the delay. Did I understand the Minister to say that there was no prospect of the demographic gap being filled in the next three years? If so, the situation in Cambridgeshire will become intolerable.

Tony McNulty: No, that would be—if I can bore people—a rather churlish interpretation of what I said. What we are talking about most directly is the immediate settlement for the forthcoming year, 2008-09. We have said in the broadest terms, to help rather than hinder police authorities, that there is also an indicative three-year settlement, and so have announced what they are likely to get over the subsequent two years. If work on demographic change, particularly sharp demographic change, such as that which I mentioned in response to my right hon. Friend the Member for Leicester, East (Keith Vaz), or other such items intervened in that process and if we got broad agreement after consultation on changing things in that direction, clearly that change could be forthcoming over the next couple of years. I am therefore not saying, "This is three years—all shut. Go away, we're not having a police grant debate over the next two years, because it's all settled."

James Paice: I am grateful to the Minister for giving way because I, too, want to discuss Cambridgeshire. He has rightly referred to Chief Constable Julie Spence's remarks about the high levels of immigration into the county. That has nothing to do with suggesting that immigrants are all criminals, as the Minister accepts, but refers to the fact that the cost of dealing with a crime involving immigrants is much higher, in terms of police time and cash to pay interpreters. It was recently announced that some 600 arrests of Lithuanians were made in the county last year, almost all of which involved much more time and cost than would have applied had they been native English speakers. When those representing the Cambridgeshire police authority come to speak to the Minister, as I know they will in two days' time, will he be able to reassure them that the demographics and the problems of immigration will be addressed before the three-year programme is firmly entrenched? Planning for three years is better than planning for one year, but not if it enshrines a permanent inadequacy in funding levels.

Tony McNulty: I take the hon. Gentleman's point, although I cannot give him a complete assurance in that regard, because he is asking me, two days after I announced the numbers for this year and, potentially, for the subsequent two years, again to inject a note of caution or potential change. However, such discussions are taking place across Government, which I hope will feed into the process over the next three years. The hon. Gentleman makes some fair points about population change, but he will know too that we try to use absolutely the latest population data and trend data.
	However, there is a view that says that whether we are talking about inward or outward migration—migration within country or from outside country—large shifts in population over short periods have significant ramifications for policing. In part, we keep up with that. The notion that we do not keep up in total, either in terms of police resource allocation or more generally, is a fair point that we should consider. I do not have the immediate answer to that over the three-year horizon, but I take the point and shall say that in terms to Julia and her colleagues when I see them on Wednesday.

Mark Pritchard: rose—

Tony McNulty: The hon. Gentleman has moved places, but I give way.

Mark Pritchard: The Minister was trying to avoid me. However, I am grateful to him for giving way, and I know that he will want to give an accurate and generous response, rather than a churlish one, given our Harrow days together. Is he aware of the great concern in Shropshire about the Government's failure to realise that our rural counties face many challenges? Of course there are urban areas in the county too, but many villages are affected by rising crime, so I wonder whether the Government have been urban-centric in their funding settlement.

Tony McNulty: No, I do not think that I accept that. I should point out to the House that the hon. Gentleman referred to our Harrow days because we happened to serve on Harrow council together. It had nothing to do with my schooling. I am sure that no one was in any doubt about that, but I just wanted to make it clear.
	The hon. Gentleman will know that policing in Shropshire is first and foremost a matter for the West Mercia police force. I know that West Mercia takes its rural policing responsibilities as seriously as it does its policing of urban areas. As fairly recent events have shown, rural areas and smaller towns in areas such as Shropshire are not immune from serious and violent crime. I shall certainly pass his comments on to the chief constable and the police authority. He will also know, however, that there has been an increase of about 56 per cent. in the budget for the area during the past 10 years.
	As I tried to say at the beginning of my speech, I am not saying that everything in the garden is rosy, or that, even after 10 years of investment, everyone has more than sufficient money to use as they choose. I am not saying that at all. As Policing Minister, I would always like to be able to afford to give more money from the centre. I am also keenly aware, however, that there has been a significant increase during the past 10 years, not just in the money from the centre but in the money collected locally. I think that people appreciate that and understand it in terms of policing in their areas.
	There are existing pressures on the police and, yes, there is a tightening of the resource base, secured both locally and nationally. On top of all that, everything changes. That is all part of the fascination and fun, if you like, of the world of policing. Policing is now palpably different from how it was five years ago, let alone 10 or 20 years ago, and it has to rush to keep up with the changes in the wider society. We need to prepare the police for that, from a sound and level resource base. Members have raised certain key issues with me, however, and I certainly do not deny them.

Roger Williams: It would be churlish of me not to recognise the changes that the Government have made to the rural policing grant as a result of the lobbying of the Minister's Department. Police forces such as Dyfed-Powys are well advanced in areas such as the civilianisation of the custody service, and they have already made savings in that way. They are therefore finding it more and more difficult to make further savings. Will the Minister give some recognition to those forces that have made a great deal of progress and that are now finding it difficult to make further savings?

Tony McNulty: I accept the hon. Gentleman's point. Equally, I recognise that the sum of all the changes that many forces have made in their own areas is far greater than what each individual force has done. I shall rephrase that, because it has confused me. While Dyfed-Powys has made significant advances in some areas, it has not done some of the things that other forces have done to accrue savings or efficiencies. We need to see more of the kind of progress that we are making through the Quest programme and the work force modernisation programme, which have in part been very successful in terms of the all-Wales solution to protective services. When those efficiencies and savings are accrued, part of my job is to ensure that they are not all gobbled back up by the centre. I think that all 43 forces would agree that that is the case, above and beyond what is laid out in the settlement in regard to cashable efficiencies and others. I take the hon. Gentleman's point, however.
	We made quite a serious mistake throughout the debate on mergers—which we were halfway through when I took over this role—when we assumed that we were at ground zero and that there had not been any real degree of collaboration or significant cross-force work in the past. There had been, and that should have been recognised. We have now made significant gains in regard to protective services, to the advantage of all the forces and the communities that they serve, since the mergers debate, and since what people are now calling my Valentine's letter—it was sent on about 14 February 2007—which set out a quite elaborate way of moving forward.
	That is a good example of how forces need to make progress in so many different areas as they deal with new challenges, such as the developments in population, while ensuring the efficiency of their core business and also that more areas than in the past go down the civilianised route or share more roles with other public service elements rather than be carried out exclusively by warranted officers. Those are fair points.

Mark Harper: Until a few moments ago, the Minister was joined on the Front Bench by the Minister for Local Government, who has responsibility for flood recovery. The Minister will know that, last year, Tim Brain, the chief constable of Gloucestershire, was the very successful gold commander during the severe flooding incident. Even if the police authority puts up our local council tax by the highest amount it can without being capped—4.9 per cent.—it is faced with the prospect of losing 200 officers or 200 staff in the constabulary. That is a real tragedy for my constituents and others elsewhere in Gloucestershire. How does the Minister justify the excellent service of last year being rewarded by such savage cuts in manpower?

Tony McNulty: In the first instance, that is a matter, as I say, for Tim Brain, but I fully and wholeheartedly endorse what the hon. Gentleman said. I have written to Chief Constable Brain and spoken to him directly about the excellent job he did as gold commander in dealing with the flooding. We were in different places but shared some close to sleepless nights as things developed in one way or another— [Interruption.] I said in different places. He did a fine and superb job in what he would be the first to note, as he looks down his list of responsibilities, is not really a policing responsibility at all. Funding is partly dealt with through what I think is called the Bellwin scheme—the hon. Gentleman rightly pointed to the Minister with responsibility for flooding, who was in his place a few moments ago. As I have said to Gloucestershire and other authorities, if they need to talk to us more directly about funding in that or any other regard, I welcome the prospect of seeing them, as I do all authorities at this time of year. I believe I have seen four or five this week, that I saw four or five last week and that I will have the great pleasure of seeing others next week. I hope that these meetings are not an opportunity for the usual shroud waving or shaking a bucket, but about seriously looking into taking full account of the peculiar circumstances of particular police forces. In that context, I would be pleased to see Gloucestershire or other authorities.
	Now I have to hum a little tune while I work through my speech, work out what I have already said and what still needs to be said. It is right that there has been an average increase of 2.7 per cent. and a floor of 2.5 per cent. That is part of Gloucester's difficulties with formula allocation, which was raised earlier, as it is stuck in that position. As I said last year and will again, in the mid-term rather than the immediate horizon for this settlement and the next two years, there should be scope for debating police funding.
	Whatever the outcome—I said the same last year—the wide spread of the local precept cannot be right. From memory, I think it goes from something like £88 a year in Northumbria, which makes a contribution of barely 20 per cent. to the overall police budget—I do not challenge that; it is just the way history has made it—up to more than £255 for the Metropolitan police and others in the south-east. In the case of Surrey, nearly 50 per cent. of the local police budget comes from the local contribution. These are or should be—with substantive local and distinct concerns—broadly universal services. Core policing business, for want of a better phrase, should be roughly the same, whether we are talking about Cambridgeshire, Gloucestershire, Kent or Northumbria. I say that without providing any straightforward answer to the problem of the balance between local and national funding, as I do not have a plan for instant reform of the precept and council tax system in my back pocket. I do say that, collectively, and hopefully on a cross-party basis, we can turn our minds to examining the longer-term financing of policing, which is usually regarded as a universal service.

James Paice: What the Minister has just said sounds perfectly reasonable and most people would support it, but he said the same a year ago. What has happened since then? Has there been any progress?

Tony McNulty: There has been some progress in the subterranean channels, but none in any public sense. The core of this three-year settlement—certainly the settlement for the forthcoming year—is rooted in the system that currently prevails. I should be happy to talk to the hon. Gentleman's Front-Bench colleagues, and to anyone else who is interested in an exercise that may reach a degree of fruition.

Elfyn Llwyd: It is just possible that the hon. Member for South-East Cambridgeshire (Mr. Paice) was a bit unfair on the Minister. The Minister's predecessor also said what he said a moment ago.
	I welcome what the Minister is saying, and hope that we can all engage in the task that he is describing. Numerous things need to be put right fairly quickly, and we have an opportunity to ensure that that happens.

Tony McNulty: To be absolutely fair, and at the risk of sounding pedantic, I should tell the hon. Gentleman that my predecessor probably did not say what I said, because he was in his post for 10 days. His predecessor almost certainly did say it, and I suspect that it was said by predecessors going way back into the mists of time. However, the point remains germane. It is right and proper for the distribution of resources to local government to be aligned with the distribution of resources to the police for historic reasons, but it should not be beyond the wit of the House to come up with alternatives on a cross-party basis. Michael Lyons examined the whole issue of council tax for some time and tippy-toed in the direction of the police tax base, but did no more than that. It was not really part of his brief. None the less, I think that, even a year on, this is a debate that we should have.

Crispin Blunt: The Minister used Surrey as an extreme example of local funding replacing national funding. I will attempt to make that point in more detail later if I am lucky enough to catch your eye, Mr. Deputy Speaker, but will the Minister acknowledge that there is a very special problem in Surrey because of the peculiarities of the funding formula?

Tony McNulty: The hon. Gentleman may be putting words into my mouth. I did not say that local funding was replacing central funding. What I said was that Surrey benefited from the highest local contribution. The central contribution has not diminished at Surrey's expense; it is just that, during the past 10 years, the local contribution has climbed higher than the central contribution.

Crispin Blunt: I am sure that the Minister would not wish inadvertently to mislead the public or anyone else. The fact is that the real total Home Office grant in Surrey fell in 2005-06. It is now narrowly above the 1997-98 level in cash terms, but there has been a real-terms cut of approximately 25 per cent.

Tony McNulty: I am not being pedantic when I say that that is simply not the case. The increase in total Government grants of some £39.5 million—50 per cent., or 14 per cent. in real terms—between 1997-98 and 2008-09 is a fact.

Crispin Blunt: On a point of order, Mr. Deputy Speaker. The Minister is in danger of misleading the House. I have the facts, in the form of a parliamentary answer given by the Home Secretary on 1 December 2005.

Mr. Deputy Speaker: That is not a point of order for the Chair. Statistics can vary in all sorts of ways. It is a matter for the debate in which we are engaged.

Robert Key: rose—

Tony McNulty: May I finish what I was saying before the point of order? The increase of £23.6 million— 25 per cent., or 0.4 per cent. in real terms—between 2001 and 2008-09 shows clearly that Surrey has benefited collectively during the past 10 years. I accept that the process may have slowed down, but it does not constitute a significant cut in real terms. However, that takes us away from the point, which I agree with, that the contribution from the local base is significantly higher than for any other force in the country. The proportion in the last round, that for 2007-08, was 46.1 per cent. compared with the Northumbria contribution of 11 per cent.—rather than 18 per cent. which I think I said earlier, in which case I did inadvertently mislead the House in that regard. Notwithstanding what the points of the hon. Member for Reigate (Mr. Blunt) might be—I have not heard them yet, but I suspect that they will be perfectly valid—I was simply trying to get across my point about there being such disparities in terms of what should be, at core, a universal service. There should be some local variation—some scope for local flexibility—but a range of between 11 and 46 per cent. cannot in any logical sense be right.
	Such disparities are rooted in a host of reasons such as history, the options various forces made when there was no capping regime, and what the original base budgets were. It will take time to get to a stage where that can be resolved, because it will invariably require either giving more money to one force and taking it off another or allowing some to go in one direction locally and others not. However, I repeat that the time for debate is upon us—if not a year late.

Robert Key: May I draw the Minister's attention to a particular problem that has arisen in Wiltshire? When I saw the proposed settlement I knew it was going to be tough, but on 26 January an MOD Minister wrote to tell me that the MOD police complement on Salisbury plain would be cut by four fifths and that the slack would be taken up by the Wiltshire constabulary. Yet no additional resources have been provided for that very substantial cut in MOD police cover. Will the Minister take a look at that and see if he can make an adjustment?

Tony McNulty: I have already looked at that and I am assured by both MODP and some of the local forces involved—although not Wiltshire in this instance—that policing remains covered sufficiently by the civilian force, but I am more than happy to look into that again. The last time I did so in any detail, that was on behalf of the less than churlish hon. Member for Colchester (Bob Russell), who has experienced not dissimilar circumstances in that MODP numbers had fallen a bit in the garrison town he represents, and he wanted to know about the impact on the Essex police force. I do not encourage the hon. Member for Salisbury (Robert Key) to do this, but he might like to speak to the hon. Member for Colchester and also get a few other Members who represent garrison towns together, and if they then wanted to explore such matters further with me, I should be more than happy to consider doing so.
	I think— [Interruption.] Even more clarity on Surrey's funding has floated up to me from below. Apparently, the figures on its funding are distorted by what happened in 2001-02, when Surrey's general grant fell by 4.1 per cent. because of changes between the Metropolitan police service and Surrey boundaries. I do not, however, think that that goes to the broad point of the hon. Member for Reigate that things have slowed for Surrey in comparison with others over the latter end of that 10-year period—which I agree with, and I am sure he will elaborate on those points when he makes his contribution.
	Some of the main points made by Members go to the heart of one of the original questions, which was about the formula. I am happy that we have been able to move, even in this year's tight circumstances, at least a little way towards the formula, but that implies winners and losers, and that is our difficulty.

Kerry McCarthy: Considerable concern has been expressed in the local media about Avon and Somerset losing out because the formula has not been applied for the last few years. Will the Minister confirm that, as a result of moving towards the formula, Avon and Somerset will get an above-average increase in the coming financial year?

Tony McNulty: Absolutely, and I am very happy to do so. We spoke earlier about Avon and Somerset, and with 3.5 per cent. it is doing considerably better than the floor of 2.5 per cent. or the average of 2.7 per cent. Notwithstanding that, I take on board the point of my hon. Friend and other Members—not least those who represent constituencies in the Bristol area—that still more might be done to move towards that formula more readily than we have done thus far. That would help me, not least in the sense of notional gainers and losers. We must consider what would have happened if we had not moved towards the formula, where in reality forces are not gainers or losers per se, unless they are judged against the absolute instant implementation of the formula. Given the way these things work, that was never going to happen all at once.
	I am mindful that having taken a range of interventions, my speech has taken a good deal of time. I know that this debate is very important for hon. Members, who want to get their local points across, so I shall bring my remarks to a conclusion when I find an appropriate place in this telephone book of a speech to do so. However, may I just make two points in conclusion?
	Given that we have sought deliberately again to maximise the increase in general grant next year and we have ensured that all police authorities have received a guaranteed minimum increase in grant of 2.5 per cent, and given the delivery of efficiency gains, prudent budgeting and our making full use of available funding flexibilities—I was going to tell the House about those, but they will have to wait for another time—we believe there is no reason for excessive increases in the police precept on council tax. As I have suggested, much good work is being done across the police service. In pursuing the new efficiency and productivity strategies, we must foster that good practice, disseminate it across the whole service and drive forward dynamically. I am always impressed by the drive for improvement and progress in all 43 authorities and forces, and I know that they operate in a dynamic environment that simply does not stand still and allow them to catch up or draw breath.
	As I have also said, we have had extensive deliberations with a range of key authorities and police. In fact, anyone who has wanted to come to see me has done so or is planning to do so over the coming weeks. We have listened carefully to stakeholders in determining the detail of this funding settlement, and I think we have got the balance right in distributing the available resources. The settlement will support the police service in meeting the challenges that lie ahead, it will help the police to deliver effectively for the public and it will protect our communities, so I commend the police grant report to the House.

David Ruffley: In opening for the Conservatives, may I congratulate the Minister on taking quite a lot of interventions on the settlements for specific police areas for the second year running? I should also flag up his comment at the end of his speech that he would be happy to receive representations from individual Members who have issues about how the formula might be working.
	This debate is vital to the public. All of us would accept that the fear of crime in this country is too high; the Home Secretary bravely acknowledged that when she questioned how safe it was to walk alone at night. Violent crime has doubled in the past 10 years: gun crime has increased—last year, a gun crime was committed every hour in England and Wales; gun-related violence has increased fourfold in the past 10 years; and knife crime has doubled in the past two years. That is not to say that crime has increased in every category over the past decade, but violent crime and the other crimes that I have listed have, and that causes the public concern. They want to know what police funding is in place to meet that challenge.
	This year's settlement is part of a three-year spending settlement, coinciding with the comprehensive spending review 2007, which extends the spending horizon until 2011. Apart from additional funding specifically for counter-terrorism, the police settlement reflects the overall spending provision for the Home Office. On that basis, we face no increase in real terms. The 2.7 per cent. grant increase for 2008-09 is to be read with similar increases for the following two years.
	It would be futile to deny that the Minister and I would agree on the importance of efficiency and productivity improvements in the police service. Compared with 2007-08, police authorities will be expected to deliver 9.3 per cent. cashable increases in efficiency and productivity by the end of 2010-11. That needs to be flagged up when considering the headline nominal figures for cash increases that are before us today.
	The settlement for the Home Office is very tight, and the Government have been forced to be so strict mainly because of a macro-economic problem—the borrowing problem—that the country faces. In March 2006, the Treasury said that it would need to borrow some £30 billion in 2007-08. In March 2007, that estimate was inflated to £35 billion, and last October it increased again to £38 billion. The Institute for Fiscal Studies tells us that the Government will borrow £42 billion this year.
	The Government have run out of money. They have spent too much in the good years and were not prudent. The police authorities are now feeling the pinch as a result. The average increase of 2.7 per cent., in the words of the Association of Police Authorities, represents the "tightest police settlement" for many years. To give an example from the north-west, the chairman of the Lancashire police authority, Malcolm Doherty, has said:
	"The demands on policing are increasing, and even with efficiency savings and other grants, we are still left with a challenging financial position."
	For other parts of the country, "challenging" is not the word. In December, Surrey police force took the decision to drop one of its divisions, going down from four to three, because of its budget shortfall and budget constraints. Chief Constable Bob Quick, with whom I have had the pleasure of speaking at length, wrote in the  Police Review:
	"We are being forced into making these difficult decisions because of our crippling funding situation, which has steadily weakened over the last six years in spite of saving £49 million over the past nine years through efficiency measures."
	He added:
	"This is unlikely to be the only tough decision we will have to make—we are exploring other measures in order to continue to make budget savings in both the short and long-term."
	That is an example of a successful police force, according to the performance and assessment framework measures. It came top of the league table last autumn. In addition, it has an excellent record of delivering great efficiency savings, which will have delighted the Minister of State. It is a forward-thinking police force, but even the chief constable who has done all the work in delivering high standards and reducing costs says that he is down to the bone. That poses some questions as to how the national formula is operating in the real world.

Crispin Blunt: My hon. Friend has properly given the example of Surrey. Is he aware that the chief constable has written to the Minister? His letter begins:
	"I am writing in unprecedented terms to express my professional concerns about the risks to public safety of people in Surrey over the next three to five years, if our funding position is not resolved urgently."

David Ruffley: I am delighted that the chief constable is writing to the Minister and I think that I know enough about the Minister to know that he will listen and take representations seriously. I urge him to focus on the Surrey example because there are other police forces—I shall not name them—which may not deliver as well as they could. If the criticism that there was not enough money were coming from them, one might be somewhat sceptical of their requests for more money, but I cite Surrey because it has done so well with efficiency savings and performance. I shall not labour that point any further, as my hon. Friend and I have both flagged up the Surrey example.
	We accept that the distribution of the grant and the implementation of the funding formula are, as the Minister rightly observed, work in progress. The way that settlements will operate this year, with the floor and ceilings, means that 18 forces will receive the minimum increase of 2.5 per cent.—average 2.7 per cent.—but only one will receive the maximum of 4 per cent. That is only one of the 43 forces.
	The joint Association of Police Authorities and Association of Chief Police Officers expenditure forecasting group, in a submission to the 2007 CSR, said that there would be a substantial funding gap at that level of grant increase—this year's amount—and for the two subsequent years. On the group's most optimistic assumptions, the funding gap by the end of the CSR period—2010-11—would be in the region of £660 million. Using slightly less optimistic assumptions, the group calculates that the gap would be £996 million—just shy of £1 billion. It is worth noting that both sets of calculations by that authoritative group assume that police authorities will increase the police precept on council tax up to the maximum of 5 per cent. a year, although of course some of them might not want to go that far.

Douglas Hogg: The phrase "funding gap" is wonderfully bland. Perhaps my hon. Friend would care to remind the House that police authorities are under a statutory duty to produce a balanced budget. They cannot operate on deficits; they must so adjust the provision of resources as to bring about a balanced budget.

David Ruffley: As usual, my right hon. and learned Friend makes an elegant and trenchant point and I hope that the Minister will be able to answer the conundrum he poses—perhaps by straying into the area of how capping will operate. I know that one or two authorities want to bust the 5 per cent. limit. To meet my right hon. and learned Friend's point, what will happen about the need to observe the statutory duty? I am sure that the Minister will want to answer that point.
	As we all agree, greater efficiency is vital if better policing is to be delivered, but I want to explore the question of the doubling of the annual cashable efficiency savings from 1.5 per cent. to about 3 per cent. That is how we arrive at the figure of just over 9 per cent. cashable savings over the CSR period. Since the current efficiency targets were introduced in 1999 the police service has made a lot of progress in meeting them. It has taken up the challenge. Over the period 1999 to 2005, for instance, when the annual efficiency target was about 2 per cent., police authorities achieved average efficiency savings of about 2.7 per cent a year, but the point about jacking up the cashable savings to 9 per cent. over three years is that much of the easy, low-hanging fruit has already been plucked; the opportunities for cashing heroic efficiency savings of 3 per cent. or more each year diminish over time. It is also the case, as has been pointed out to me many times by people who come to see me, that the efficiency savings in earlier years were often re-allocated to improve front-line services, but that is likely to be less easy with future efficiency savings, which will have to fund the base, because policing demands are growing at a fair old rate. Everyone agrees that they are growing by more than 2.7 per cent. a year.
	If those tight targets are to be met on the efficiency side, will the Minister share with us what he thinks some of the consequences may be? The first will be of immediate interest to every member of the public listening to the debate—I am sure they are watching in droves: does the Minister accept that there are likely to be fewer officers on our streets as a result of this year's settlement? The chairman of Cheshire police authority has warned that officers will be pulled off the streets to perform administrative duties unless more funding is found. He set out that case in December 2007, in  Jane's Police Review.
	More recently—last week, in fact—the latest police strength figures came out from the Government, and they show a decline in the number of officers from 140,038 in September 2006 to 139,710 in September 2007. I ask the Minister a simple question: does he believe that that trend will continue, as a result of the settlement? The question relating to police on the streets is, to many people, a simplistic one, but it is the one that most of our constituents ask.
	Last year and this year, the Minister acknowledged how the national formula was working in a slow and evolutionary way. However, last year more than this year, he acknowledged that its operation was palpably unfair to certain parts of the country. I should like to give an example relating to the east midlands police authorities—Nottinghamshire, Derbyshire, Leicestershire, Lincolnshire and Northamptonshire—whose representatives came to visit me to raise some of their specific concerns about what they consider to be a growing funding gap. Following the settlement, their funding gap amounts to about £47 million, and like the ACPO and APA estimates that I referred to earlier, they assume a precept increase of the full 5 per cent. If the precept were to increase by less than that—for example, by 4 per cent.—they calculate that that would increase the funding gap to more than £60 million, up from £47 million, over the CSR years.
	It has been pointed out to me—I am sure that this argument could be adduced for other parts of the country—that the east midlands region is one of the two fastest growing regions nationally, with its population growing by 0.8 per cent. per annum and changing population demographics, including, but not limited to, the increase in migrant workers from EU states, which is greatly adding to the complexity of policing there.
	In respect of my own neck of the woods in the eastern region, the chief constable of Cambridgeshire made some important points along those lines—as, indeed, has the chief constable of Kent, Mike Fuller. They have made representations about the grant allocation to the effect that perhaps not the most up-to-date population data are being used and that, as a result, they are not receiving the appropriate funding. It would take the Minister too long to deal with every police authority, but I wonder what his view is of the east midlands case.
	The settlement must also address some issues that cause concern, particularly when we hear them from those on the front line—we are not talking about think-tanks or one-off examples from constituents. I should like to know how the Minister thinks that this year's settlement will address the point made by the Police Federation, which last November issued a study on the number of detectives in this country and calculated that there were about 2,000 vacant detective posts. That is particularly important at a time when, as I said in my earlier remarks, violent crime has doubled in the past 10 years, knife crime has doubled in the past two years, gun crime has doubled in the past four years and there are unhappy data on robberies and murders. There are fewer detectives to deal with those crimes.
	I wonder whether the Minister can give us an assessment of the recruitment and retention problems that force some officers to rely on trainees and unqualified officers in criminal intelligence departments. There are reports that inexperienced officers are investigating for the first time serious offences, such as stranger rapes, with little or no supervision and that the remaining detectives have to carry huge case loads and continue investigations, while still being expected to respond to the next major incident. Of course, target-driven detection is still occurring, with targets being met by reclassifying offences or encouraging the public to drop complaints—something that officers simply do not want to do, but that is what the Police Federation tells us.
	In previous debates on this subject, the issue of police community support officers has been raised. The Minister and I agree that PCSOs are important to the proper implementation of neighbourhood policing, a policy that we support, but the number of PCSOs promised in 2005—24,000—has been reduced to 16,000 nationally. In 2005-06, £91 million was provided to help with the recruitment of PCSOs. It would be useful to know what he thinks the effect of the settlement will be on PCSO funding, and what he anticipates it will do to the number of PCSOs in the next year. We stress that PCSOs play an important role in making neighbourhood policing work, and it would be useful to know the resource implications for them.
	In relation to the police precept, we know that in 1997, some 85 per cent. of police forces' gross revenue was financed through central Government. In 2006-07, the latest year for which we have figures, the proportion was expected to fall to 60 per cent. The amount of police spending financed through the council tax precept has doubled in real terms between 2001 and 2006-07; in short, council tax now accounts through the precept for one fifth of police force expenditure, compared with one eighth in 2001. Ministers have claimed over the years to be almost personally responsible for the growth since 1996 in the number of additional officers, but as we face higher precepts next year, now is probably the time for the Government to give credit to council tax payers across this country, who have certainly done their part to fund extra recruitment.
	I have a question about the police precept for the Minister; it bears on a policy on which I think he and I agree. In order to deliver efficiencies, which will be needed if the current settlement is to be implemented in a sensible fashion, some forces want to embark on voluntary merger, including two forces in East Anglia that I know have been in touch with him as well as with me. They say that they simply cannot go ahead with the voluntary merger that will deliver efficiencies without precept equalisation or reconsideration of the precept regime. Can he tell us anything about precept equalisation that might give encouragement for the next three years to those forces that want to merge voluntarily? That is at the heart of the efficiencies that he and I both seek.
	This debate could not pass without some reference to police pay, not least because the police authorities, which are obviously the main customers concerned in today's announcement, were somewhat foxed by the Home Secretary's decision, in a departure from the arbitration ruling, not to give the 2.5 per cent. but to stage the award so that it will be 1.9 per cent. this year. It has an impact on how police authorities plan in-year for delivery of police services. The APA has pointed out on many occasions its extreme disappointment that the Home Secretary did not implement the 2.5 per cent. award. It says:
	"Most police authorities had already got this money in their budgets, and the Home Secretary has prevented us from paying it. The decision does not help the financial position going forward since, as indicated above, the full 2.5 per cent. will be in base budgets for next year. The APA believe that the Home Secretary's decision is ill-advised...creating unnecessary industrial strife and jeopardises future work on modernising the police work force."
	It would be useful if the Minister could remind us of the argument for not paying the 2.5 per cent. when the police authorities had already budgeted for it.

Anne Milton: Will my hon. Friend join me in sympathising with many of the residents of Surrey, which he mentioned? We have policemen who are unpaid and unhappy and council tax payers who have to bail out the police because they are not getting fair funding from the Government, yet nearly half the crime in Surrey is committed by people who do not even live there.

Eric Martlew: They can't afford to live there.

David Ruffley: May I point out to the hon. Gentleman that Surrey faces challenges, just as anywhere else does, and the Minister drew attention to that, both in last year's debate and since then? I reiterate that Surrey is an example of a force that works hard to find efficiency savings, and my hon. Friend the Member for Guildford (Anne Milton) will agree that we must get away from the notion of stereotypical leafy suburbs in the home counties that have fewer problems with drugs, violence and sexual offences than other parts of the country.

Anne Milton: I thank my hon. Friend for his generosity in giving way a second time. As he suggested, the notion that Surrey is a leafy suburb where nobody commits any crime is ignorant in the extreme. In fact, a huge amount of crime goes on behind closed doors—I do not have the figures to hand—including domestic violence and drugs crime in particular. The trafficking and movement of drugs is a major issue for Surrey police.

David Ruffley: My hon. Friend makes an excellent point, underscoring the fact that it is not right that parts of the country that are considered leafy suburbs should be cheerfully told, "You must make do, and receive less money per capita." That is not an acceptable argument. It is not acceptable to me, and it is certainly not acceptable to my hon. Friend and her colleagues in Surrey.
	I should like to draw my remarks to a close by referring to something that we shall be discussing much more in the House from next Thursday—the need to reduce police bureaucracy, which is at the heart of any tight police settlement. I hope that the Minister would agree that when we talk about efficiency, we must consider how we can help the police—and I mean the whole police family, not just serving police officers—to do their jobs without so much interference. It is not just a question of spending a shed-load of money on IT. If it was simply a question of getting the police back on the beat by spending more money on IT, successive Governments might have done so, but there is no big bang approach on IT. It is worth making a salutary observation: the police service, in the six months in which I have been Opposition spokesman and done red-tape exercises in different police stations on different crimes up and down the country, say that politicians have been talking the rhetoric of cutting red tape for decades. I do not think that is just the past 10 years, although certainly in that period claims have been made about reducing police bureaucracy. If the Government had been successful in the past 10 years, the right hon. Member for Airdrie and Shotts (John Reid), the previous Home Secretary, would not have commissioned Sir Ronnie Flanagan, over a year ago, to conduct an independent review of the way in which the police operate. We look forward to publication of that review later this week.
	At the heart of the review is the paperwork problem and the risk aversion that accompanies it, covering risk in paper. Before we get carried away with delivering more efficiencies, we must remember that the talk has not been delivered on in the past 10 years. In 2002, the right hon. Member for Sheffield, Brightside (Mr. Blunkett), the then Home Secretary, promised a "bonfire of the paperwork", alleging that 90,000 hours a year could be saved. The Home Office Policing Bureaucracy Taskforce published a report with 52 major change proposals, which I have read several times. Much of it is quite sensible, but the problem is that there has been no follow-up audit to work out how many recommendations have been implemented and to what effect.

Douglas Hogg: My hon. Friend is entirely right to challenge the overregulation of bureaucracy in the police service, but will he keep in mind the fact that power, once given to officers, is often abused? I have practised at the criminal Bar for 40 years, and I can remember police interviews in which police officers frequently verballed defendants. The requirement that all police interviews should be tape recorded is an enormously important safeguard, and we need to remember that there is a possibility of abuse.

David Ruffley: I take my right hon. and learned Friend's point, which I have debated with the Minister. We would be at one on something as major as the tape recording of suspects' interviews; I hasten to add that that was introduced by a Conservative Administration in the 1980s. I do not think that any Member on either side suggests that safeguards of such importance and magnitude should be tinkered with. The only way in which the Minister would tinker would have my support. A few days ago, he announced a pilot in Lancashire to see whether the clumsiness involved in bagging up cassettes, labelling the bags and all the associated paraphernalia could be avoided and whether the service could be better delivered by digitised recordings. As the Minister knows, I support that pilot.
	I want to return to the fact that good intentions—and we have had 10 years of them—are not enough; I hasten to add that before 1997 there were good intentions about cutting paperwork. The 2002 promise from the then Home Secretary has not been delivered on. In 2004, a White Paper was produced.

Tony McNulty: rose—

David Ruffley: If the Minister must intervene, I shall give way.

Tony McNulty: I did not want to lose the hon. Gentleman's point. He is perfectly right that the Police and Criminal Evidence Act 1984 has stood the test of time very well; that is emerging from the review that we are in the middle of. Apart from changes in respect of the pilot that he mentioned, we will be very cautious about making changes to the 1984 Act, not least because of the points that he made. I am sorry to have cut across him; I just wanted to put on the record the fact that PACE has stood the test of time.

David Ruffley: I am grateful to the Minister.
	The 2004 White Paper promised to free up the equivalent of 12,000 extra police officers for front-line policing by 2008 and claimed at the time that 7,700 forms had already been made obsolete across 43 forces. By last year, that claim had grown: it was said that nearly 9,000 forms had been cut. The problem is that Ministers will not list the forms; we have asked them to put such a list in the Library. My sense of the situation must logically be right—if Ministers know that 9,000 forms have been cut, they must know their names; if they know those, they can publish and release them. I urge the Minister to do that.
	What I have asked for is not only demanded by politicians; the Police Federation pointed out that the Home Office has provided it no information about what the forms were or how frequently officers used them. We are not talking about any old form—we want the most frequently used forms to be cut, not only the forms that might be used once every two years. The Police Federation has not received any information on those allegedly abolished forms or on how long each form took to fill in and thus it does not know the average time saved as a result of the alleged cutting of the forms. We have asked for the information on a cross-party basis. If we know what the Government think they have cut from the police force case load, that will assist our work on red tape.
	The Minister is keen to talk about a cross-party dialogue—not all the time, but quite a lot of it—and we are happy to enter into that, depending on the subject. What I have just mentioned should not really be a party political issue. The police are crying out for a reduction—but not in all paperwork. Sir Ronnie Flanagan famously said that police paperwork is a bit like cholesterol; there is good and bad cholesterol. In respect of the point made by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg), I should say that an example of good cholesterol would be the PACE codes and legislation requiring proper tape recordings of what witnesses say. However, there is a lot of bad cholesterol—useless paperwork—as well.
	In conclusion, the time that all police officers spend on incident-related paperwork increased from 10.3 per cent. in 2004-05 to 11.4 per cent. in 2006-07. As a result, the percentage of time spent on patrol fell from 14.2 per cent. in 2003-04 to 13.6 per cent. in 2006-07. Those are the most recent trends, and they show that the police are spending more time on paperwork and less time on patrol. For too much of the time, our police officers are form-fillers rather than the crime-fighters that they wish to be.
	We know that we have to cut our cloth as a result of this tight settlement, but these efficiencies must be driven forward at the level of the bureaucracy and in other arenas. Activity-based costings are very important, but I will not detain the House with the arcane parts of that aspect. If the Minister is so committed to cutting paperwork, why did he tell me last week in a written answer that the Home Office post of national bureaucracy adviser, which was set up to slash police red tape, has been vacant since April 2006? No one has been doing that job for 18 months. I know that the Minister and his Home Office officials try hard to improve the efficiency of the service, but we have to go back to basics. Unless we can get improvements not only in the amount of paperwork that the police are subject to but in the efficiency of the processes, this police settlement will not be delivered, and we will not have the policing that this country so desperately deserves.

Gwyneth Dunwoody: Some time ago, it was suggested that Cheshire and Liverpool should amalgamate their police forces. Oddly enough, that decision did not meet with the unalloyed admiration of the citizens of Cheshire. Indeed, their representations were so effective that the plan was abandoned. That area was then the responsibility of the then Home Office Minister who is now Secretary of State for Communities and Local Government.
	This three-year settlement may turn out to make that not only a pyrrhic victory, but one of gigantic proportions, for the citizens of my constituency. It will penalise Cheshire in no uncertain terms, and I want to make it clear why that is a matter of concern to me. The general public do not understand the relationship between the finances of central Government and local government. They are more inclined to believe people who say, "We want to dilute our powers from central Government and give them back to the people who are nearest to their constituents. We want local government to take many of the decisions that will affect the policing of the streets and the general level of protection that people have in their town centres and homes." Therefore, they do not always understand why decisions taken at central Government level seem in some manner not to chime with the decision to send those powers, and the finance needed to maintain those police forces, back to the areas in which they are so desperately needed.
	Cheshire will suffer enormously under this settlement. I have in the past made it an important aspect of my debates with local government elected officials to ask them why Cheshire has not, for a very long time, had a much higher police precept. It is essential not to cut at local authority level the money available, but to demand further amounts and make it clear to the population why those sums of money are necessary.
	Most people who live in certain areas of Crewe or in the centre of Nantwich, and who are there on a Friday or Saturday night, do not have difficulty in understanding the connection between money and police officers on the beat. Most people who find themselves, as the neighbours around my office building did after a recent weekend, surrounded by a sea of broken glass and having been submitted over a long period to real social disorder, have no problem understanding why we need police officers; indeed, they want to see many more. The burden of their complaint is frequently that no matter how much money is presented to them annually in the figures in their rates returns, those officers are not there on the beat. They are told clearly how much the police force costs them, but nevertheless, when they look for the neighbourhood policing about which they have heard so much, they find that it is somehow not there. Yet we are told that for the Cheshire police authority, the response to the Government's provisional funding allocations for 2008-09 to 2010-11 will mean that the grant settlement of 2.5 per cent. will only just cover inflation, and unless there are other settlements, it will result in the loss of 80 police officers from the front line. That is a massive, and quite unacceptable, cut.
	The police authority has not suddenly come across this state of affairs; it has made representations over a long period, saying that it would be facing a large funding gap of nearly £6 million even if it were just going to stand still—in other words, to overcome reliance on reducing reserves to support level 2 operational demands in the current year, to maintain its commitment to, and public support for, neighbourhood policing, and to support further efficiency. The authority is also aware that it is facing a double whammy. Not only does it not have a suitable settlement to enable it to improve and increase the amount of policing that my constituents can call upon, but it will be threatened with a cap if, for any reason, it succeeds in raising more money than Her Majesty's Government find acceptable.
	However, in the name of transparency, of which more anon, the Government have chosen to produce a grant formula that, frankly, is no clearer, and is in some ways more obfuscatory, than the ones we used to have. The method does not simplify the system, which was the reason behind its introduction, and it contains elements of notional levels of spend and tax-base calculations. For example, let us consider the formula issues raised with regard to Cheshire police authority. Why is the net relative needs/resource amount per head of population £3.53 in Cheshire and £10.26 in Avon and Somerset? We suffer equally badly when it comes to resource equalisation: 73.9 per cent. of the needs amount is deducted, on the assumption that Cheshire has a richer council tax base.
	Let us be clear about this. The Home Office is demonstrating a Janus-like ability to say to Cheshire on the one hand, "You're really just an adjunct of Liverpool and Manchester, so you must be reorganised so as to enable you to organise your affairs through a greater relationship with the city regions," while on the other hand it is saying, "But you have a much higher tax base." It is essential to look at the number of band D properties; we will then discover that council tax income is the third lowest in the country. Is it assumed that our council tax is higher, or is it simply assumed that Cheshire can be exempted from all the arrangements made in relation to other areas? In the past, Cheshire was given an area cost adjustment, along with London and the south-east counties, which recognised higher labour and living costs, but the average is now very low, and no longer of any benefit.
	A completely essential, but somehow ignored, element of policing in Cheshire is the development of attacks by organised crime. The cities that we are told are the drivers of affairs in our area are very good at disgorging their criminal elements on to the motorway and into our county, not least because the more efficient the policing is in the centres of cities, the more the instinct will be to develop organised crime elsewhere, where policing is perceived not to be of the same standard. We therefore require a much more expensive and intensive policing system.
	Cheshire has always taken a proactive stance against serious crime. We recently brought to justice in our area a criminal with repeated attempted murder and firearms offences after four other forces had failed to do so. That effort alone involved 90 witnesses and cost £200,000. However, no part of Her Majesty's Government is prepared to accept the cost to Cheshire of those direct attacks from the Liverpool and Manchester areas.
	Now we have a potential further constraint through capping. It is essential to understand that the missing £9.7 million needed to plug the funding gap will be obvious when we look to the provision of front-line services. The majority of ratepayers in Cheshire are more than prepared to pay a proper rate for policing services. They understand that their enjoyment of their homes and the calm in which they can use the services of their towns and cities depend on the provision of policemen on the beat. That is not an abstract theory, but a demonstration of practical understanding of the pressures on those areas. So far, however, we have been unprepared or unwilling to accept the absolute cost of the formulae to constituencies such as mine and counties such as Cheshire.
	Many of the formulae were developed in the name of transparency. The Department is good at saying how much it cares and how much it wishes to respond to the interest of individual taxpayers and ratepayers. The Secretary of State for Communities and Local Government has made some engaging speeches about the need to respond. She says, for example, that wherever there is a petition containing more than 250 names, she will take note of the content of the petition. I do not know how she reconciles that with the fact that the 10 Downing street website now has a petition with more than 400 signatures that objects to the division of Cheshire into two bits—but I suppose we all have to have our little inconsistencies from time to time.
	When the Minister replies, will he give me one simple bit of information? The division introducing unwanted new local authorities has been imposed by the Department on the basis that it will not only improve the facilities but will be much cheaper and more efficient, and will roll us forward to a fantastically bright future. Cheshire county council made a freedom of information request to ask why there was a direct and clear difference between the figures originally given to the county council by the Department and those that were published subsequently: why was no FOI request accepted?
	If the report asked for by Paul Rowsell, to get an independent assessment by the Institute of Public Finance of the costs of reorganisation, was so strongly supportive of the Department's attitude, why are we not allowed to read it? If someone had said what a good job I had done, I would have thought that it might be a good idea to make that public. Indeed, I might seek to give it to everybody who inquired—but somehow or other, we are told, that is not the case.
	The draft Cheshire (Structural Changes) Order was laid before Parliament on 31 October, and will create two new authorities with, we were told, annual savings of £16 million and transitional costs of £25 million. Those numbers cannot be recognised from the original proposal to create two new authorities, which said that the ongoing savings would be £30 million with transitional costs of £16.6 million. In effect, the Government are saying that they do not accept the district figures. To put it another way, the headline transitional costs have increased by 50 per cent., the headline savings have reduced by 50 per cent. and the payback period has doubled to almost four years.
	Before the Department takes even more money away from Cheshire ratepayers and before it is prepared to accept that we will lose 80 officers on the front line, whatever its decisions are, it should think seriously about how it intends to justify those policies. It may find that rather more difficult than it seems to anticipate.

Christopher Huhne: I am delighted, as always, to follow the hon. Member for Crewe and Nantwich (Mrs. Dunwoody), who spoke a great deal of sense, drawing on the experience of Cheshire. She anticipated some of my remarks. I note that in a recent MORI opinion poll conducted in that county, 87 per cent. of people said that they were willing to pay more for the police. However, there are substantial difficulties in doing that, given the nature of the settlement and the capping of the council tax. If we consider the difficulties that the police in Cheshire have faced in several high-profile recent cases, such as that of the terrible murder of Garry Newlove, we can sympathise with the hon. Lady's remarks.
	I agree with the attack that the hon. Member for Bury St. Edmunds (Mr. Ruffley) made on the Government. Clearly, there is serious concern among the public about crime. There is excessive violent crime, which has doubled since the Government came to power. The deterrent effect is, crucially, composed of not merely the severity of the penalty but the likelihood of detection. That is why the police service is so crucial in the fight against crime, and why the dangers of demoralising it seem considerable in the wake of the decision to phase the police pay settlement.
	Several observers have pointed out that we are considering the tightest police grant settlement for a decade, at 2.7 per cent. As the Association of Police Authorities and the Association of Chief Police Officers pointed out in their joint budget exercise, even if full use is made of the leeway allowed on council tax, there is a danger of a shortfall of £1 billion by 2011.
	The stress points are already clear. They appear, first, in the Government's announcement. The flatness of the settlements to so many police authorities tells us that the sum that the Government can use to make genuine progress in closing the gap for individual police authorities with their needs-based formula is limited. Several hon. Members have outlined the problems that are likely to arise from that. Nearly half the police authorities will effectively get the floor increase, which is evidence that there is not enough money in the settlement to make genuine progress towards closing the gap in authorities such as Avon and Somerset, and Cheshire.

Tom Brake: Does my hon. Friend agree that because the budgets are so tight, if something external to the police, such as, for example, the closure of the local magistrates court—in my area, that would be Sutton magistrates court—occurred, the knock-on effect of the additional police time taken to go elsewhere would mean that the police could not cope with such external events, over which they have no control?

Christopher Huhne: My hon. Friend makes a good point about one of the pressures on the budgets.
	Another example of stress appears in the figures. External provision for the police amounted to 85 per cent. of gross revenue expenditure in 1996-97, but is now projected to be down to 61 per cent. That represents an extraordinary drop and an extraordinary increase in the amount of funding expected from the council tax payer, particularly when one bears in mind what an incredibly rotten tax the council tax is, how regressive it is and how unfortunate a burden it imposes on those who are least able to pay, and whose households are under considerable financial stress.
	There is also clear evidence of stress in the Home Office's handling of its own budget over the past year, such as the sudden announcement in the middle of the year that the previously agreed level of funding for police community support officers would be cut. All those factors combine with the pressures from pay and general inflation to bear down on a budget that will clearly be inadequate for the demands put on it in the year ahead.
	We know that about 80 per cent. of police costs are staff related. If we are looking, as the Government are, for a more than 9 per cent. efficiency gain, all of which is meant to be turned into cash over the three years of the comprehensive spending review, it seems likely that we will be looking at job losses. It would be honest of the Minister to give us any projections that the Home Office has made of the likely sacrifice, in terms of both the police and their support staff, if the efficiency gains are insisted upon, given the extraordinary proportion of staff costs.
	What is the way out? Clearly efficiency is one way.

Douglas Hogg: I entirely agree that efficiency is one of the ways forward, but the hon. Gentleman should also keep in mind the fact that any staff wastage or loss will almost certainly be associated with redundancy payments. That, too, bears down on the police budget.

Christopher Huhne: The right hon. and learned Gentleman makes a good point. In the police service, although less so in the service staff, the capacity to lose people through natural wastage, as the unfortunate euphemism goes, is extremely limited. We might well be looking at redundancy payments, therefore, which would further increase the pressures on already stretched budgets.
	IT has a cost, too. The introduction of IT is devoutly to be wished—I am sure that nobody in the House wants the police to be involved in any unnecessary avoidable paperwork. The capacity of IT to reduce that paperwork is important, but that comes at a cost, particularly given the Government's track record on IT projects and overruns. Another important element, which we are beginning to see in the Metropolitan police area, is the provision of figures at a low local level—at ward level, rather than at basic command unit level. That will allow us to burrow into truly effective local command units and spread best practice, and that has to be good, too.

David Taylor: The hon. Gentleman talks about IT project failures, which have been legion over 20 years or more, but we are not really talking about the type of project with the capacity to improve data collection in the police service and thereby reduce forms; rather, we are talking about the introduction of hand-held computer devices and things of that kind. That is not the type of project that has typically caused such angst, overruns or excessive costs. Does he recognise and accept that?

Christopher Huhne: I certainly hope that the hon. Gentleman is right to think that there will perhaps be fewer overruns on such a project. However, I do not share his confidence, having tabled a number of written questions to different Departments a few years ago, when there were overruns with IT projects almost regardless of the type, and particularly with networked IT projects. Although the proposal is for hand-held devices, they still have to be connected to a network, the software has to be compatible and a large number of external consultants have to be paid. For some reason, there seems to be a serious problem with the ability of the Government—not just this Government; the hon. Gentleman was right to point out that this has been a long-standing problem—to handle IT projects and bring them in on time and to budget.

Tom Brake: Does my hon. Friend agree that when budgets are tight, even if the IT projects are successful there is a risk that the training budget associated with training people to use the IT systems will be cut, so that officers often cannot make effective use of them? That point was put to me by a police officer on the march a few days ago.

Christopher Huhne: My hon. Friend makes a good point; I am happy to agree with him.
	It is also crucial that the Government begin to think about the big picture with regard to improving police efficiency. One way of doing that would be to reduce the demands imposed on the police by an entirely legislation-happy Home Office. Since 1997 it has introduced 3,400 new criminal offences for which the police are expected to bring prosecutions. That is extraordinary, because the vast bulk of the crimes that our people are concerned about are those that have been an offence in this country for as long as anyone in this House has been alive, and probably a good deal longer. Simplifying the legislation and reducing the demands on the police are thoroughly desirable objectives, about which we have not yet heard enough from the Government.
	The House will not be surprised to hear that we believe that savings could be made on the Government's identity cards project. Those savings should instead be put into visible front-line policing to reassure our communities. We now know from the safer neighbourhood teams in London that that is a successful way of reducing crime.
	We believe that the settlement is eye-wateringly tight, and that it will lead many police authorities and police forces into making wholly unacceptable decisions on job cuts, such as those described by the hon. Member for Crewe and Nantwich. I understand that the Cheshire constabulary has already reduced its head count in the past year. For precisely those reasons, we shall protest against the settlement in the only way we can—by voting against it. We shall do so not because we think that it is not providing enough money, but because we think that the police deserve more.

Douglas Hogg: I should like to begin by offering the House an apology, because what I am going to say will be of particular interest to the people of Lincolnshire and of perhaps rather less interest to other right hon. and hon. Members. In that respect, I shall be following the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). An excuse—if we need one—is that this is one of the few occasions on which we can articulate on the Floor of the House the problems that face our own police forces. So I apologise to the House, but I am going to speak primarily about the difficulties being faced in Lincolnshire.
	I acknowledge that the Minister for Security, Counter-Terrorism, Crime and Policing has been good enough to see me on at least one occasion to discuss the problems of Lincolnshire. I also know that he is seeing the chairman of the Lincolnshire police authority on 7 February, and I think that the chief constable is going to be there at the same time. He has also seen members of the police authority on previous occasions, as have his officials. He will be aware that the Lincolnshire police have produced a financial recovery report, which they submitted to the Home Office last year, and I am sure that it has been the subject of considerable study in his Department. I therefore acknowledge that he has considered—although perhaps not addressed—the problems that Lincolnshire faces.
	I should like briefly to summarise the issues that the Lincolnshire force is facing. First, it has the lowest funding of any force in England and Wales. The next lowest funded force gets £11 million more. Secondly, as I said in an intervention on my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley), the police authorities are under a statutory duty to produce a balanced budget. They do not have the legal right to operate at a deficit. That is important, because, unlike most authorities, they have to adjust their spending to reflect their revenue stream. They cannot resort to borrowing; they have to bring about economies.
	In the absence of additional funding for the Lincolnshire force, there will be a deficit of £7 million in 2008, of £12 million in 2009 and of £14 million in 2010. Such figures would not be huge in the context of the metropolitan forces, but they are very considerable in the context of the Lincolnshire force. The hon. Member for Eastleigh (Chris Huhne) fairly pointed out that about 80 per cent. of the costs incurred by police authorities were staffing costs. In the case of Lincolnshire, the figure is nearer to 85 per cent., and if we want to bring about a reduction in costs, we inevitably have to look at staffing levels.
	There are only two groups of people in a police force: the police officers and the civilian staff. Police officers are Crown servants, and cannot be made redundant. The force can be reduced through wastage or by voluntary resignation, but not by sacking. Consequently, if staffing levels are to be reduced, the non-police-officer content has to be considered. That has at least two consequences. First, there will be heavy redundancy costs which will have to be incorporated into the spending plan in any budget. Secondly, any cuts in the civilian staff will result in many of those posts being filled by police officers who could otherwise be out on duty. I am not for a moment saying that we cannot bring about efficiencies through a reduction in staff. That might be possible, and the use of information technology is a way forward. We must bear in mind, however, that there are immediate and serious funding problems associated with such decisions and that, in any event, many of the holes would have to be plugged by serving officers.

David Heath: The right hon. and learned Gentleman should make no apology for talking about Lincolnshire. That is what these debates are for. Will he address another significant funding issue? He has concentrated on the question of revenue expenditure, but there is an equal—if not even more worrying—squeeze on capital expenditure, which will prevent forces from taking the very steps towards improved efficiency that could mitigate the effects of a tight revenue budget.

Douglas Hogg: The hon. Gentleman is right. Such measures would, for example, constrain the ability of any police force to introduce new IT provision, because that comes largely out of capital expenditure. Alternatively, a force might find that it had to cut back on its building programme. The hon. Gentleman is quite right to raise that serious issue.
	I should like to put a bit of flesh on the generalities that I have outlined. If we wished to achieve the savings in Lincolnshire that will be required in 2010-11, we would have to find a saving of more than 200 officers. In fact—if I can read my writing—the figure would be 275, which is one quarter of the total force. Alternatively, if we were to concentrate exclusively on civilian employees, their number would have to be reduced in that year by 364. Those are substantial numbers.
	I want to turn now to the grant itself. I am sorry that the Minister for Security, Counter-Terrorism, Crime and Policing is no longer in his place, although I appreciate that it is not possible to be here at all times. On the face of it, the grant of 3.1 per cent. to the Lincolnshire force is not out of line with the grants that have been made to other forces. It suffers from two problems, however. First, it ignores the fact that the Lincolnshire force is the lowest funded force in England and Wales by at least £11 million, as I have already mentioned. Secondly, it ignores another critical point, which is that, in 2007-08, there was a special one-off £3.4 million grant. If that is taken into account as it should be, we see not an increase of 3.1 per cent. but a decrease of 1.9 per cent., or £1.37 million—and those are all significant figures.
	Let me next address the question of what can be done about the problem, given the realities of life. There are only three sources of finance available to the police service. One is central Government funding through the grant; the second is special one-off grants; and the third is the precept. I shall speak briefly on each of those sources.
	On the formula that produces the annual grant, ever since I have been a Member of Parliament, from 1979, rural forces have faced particular problems because of their sparsity—and in forces such as Lincolnshire, there is a particular and perverse difficulty. We are very sparsely populated as a county, but there are no large spaces of emptiness. In North Yorkshire or Cumbria, for example, there are large areas of emptiness, where there is nobody around—and very nice it is too, I might add—but in Lincolnshire that is not the case. It is a very large county, but all of it is populated. There are small settlements, separated by a few miles, which may well be true of other constituencies. That makes for a special problem when it comes to policing, but that particular problem associated with sparsity is not taken into account at all in the formula. I would like to see the formula looked into again in that light. I have been calling for that for nearly 30 years, but it has not been a successful call, so I am not unduly optimistic now. On behalf of forces such as Lincolnshire, I say that it is imperative that the formula be looked at again. One has to ask whether that is going to happen in the next two weeks, and the answer is obviously no.
	The next aspect is ad hoc funding of a yearly kind. I acknowledge that the Government produced a one-off payment of £3.4 million last year and I would obviously like to see another substantial payment come through this year. However, there is an important difficulty in that, if structural problems are funded by way of annual one-off payments, that fails to deal with the underlying structural difficulty itself. There is, perversely, the additional problem of disenabling police authorities from long-term thinking, as they will not know what their revenue stream will be. It is difficult to take strategic decisions about the force or any police operations without knowing the amount of long-term structural funding. Although I would welcome an additional one-off grant, either the same or larger than last year's, I do not regard it as a solution to the long-term structural problems that I have identified.
	That brings me to the precept, which is a real problem. There is no doubt that the Lincolnshire police authority is going to come forward with a very substantial increase in the precept. However, precepts are subject to capping and, even worse in one sense, this will be deeply resented by the council tax payer. Council tax payers will say with considerable force that this is a stealth tax, whereby they are being obliged to shoulder the cost of providing a proper police service in Lincolnshire and elsewhere, which should properly be borne by the Government.
	My strong suspicion—I am sorry to say this to the Minister—is that that is deliberate policy. I believe that in many rural areas, it is deliberate policy to drive up the local tax by way of stealth taxes of that kind in respect of those matters that should be properly borne by central Government. It is not coincidence, but deliberate policy. Where do we go from here? As I said, I believe that the Lincolnshire police authority will come forward with a very substantial request for an increase in precept. I do not believe that it has any alternative. It is an unfortunate state of affairs, brought about by a deliberate policy of Government, but I am a realist and I think that the police service in Lincolnshire needs to be reinforced, which will require a substantial increase in the precept. I shall defend that, but I greatly regret the fact that it has to be met.
	I say to the Under-Secretary of State that it would be perverse of her and her colleagues to impose a cap on the request that may well be made by the police authority, which will have been brought about by what I believe to be the Government's failure to provide proper funding for Lincolnshire. If that request is made by the police authority, it should be allowed.

David Taylor: The right hon. and learned Gentleman represents a seat in the same region as me. There are two factors to which he has not yet alluded in respect of the financial problems facing the Lincolnshire and Leicestershire forces. First, there is a lag between population growth occurring on the ground and its being reflected in the formula. That is true of Lincolnshire more than Leicestershire, but the whole of the east midlands is the most rapidly growing region, which needs to be addressed. Secondly, there is the impact of floors and ceilings, which have prevented Leicestershire from receiving an extra £6 million over the last two years and an extra £9 million over the next three. That speeds up the rate at which the needs of authorities need to be reflected and paid for in the central grant. That affects Lincolnshire as much as it affects Leicestershire, does it not?

Douglas Hogg: The hon. Gentleman is right. The two points that he identified are certainly common to his county and mine. I suspect that they are also true of the other counties in the east midlands. However, he speaks with authority for his own county and I can confirm that it is true of Lincolnshire.
	I wish to make two further points before finishing. First, I personally believe that we need to see a huge increase in the number of police officers on the beat, especially in the more stressed urban areas. That point arises from my practice at the criminal Bar. The House will know, as I frequently declare my interest, that I frequently appear in criminal courts. By the nature of things, I tend to represent people who have committed crimes in urban areas. There is tremendous and serious lawlessness in many of our cities. However we describe it and whatever its immediate causes—these are not matters for today's debate—I believe that a very large increase in police numbers is necessary and should be done on a pilot basis—increasing by 20, 30 or 40 per cent. the number of police officers available. That will prove hugely expensive to fund.
	That brings me on to a point that I have made many times in the House—the value of the special constabulary. I was a special constable for two or three years and greatly enjoyed it, although it was many years ago now. I believe that it provides a wholly untapped resource. Long ago, we accepted that the Territorial Army and the fire service should be entitled to pay their part-time people. I have long believed that we should be able to pay special constables a proper retaining sum. If we did that in counties such as Lincolnshire, many people willing to patrol the streets of their villages and localities would come forward. I urge Government and Opposition Front Benchers to think about the advantages of that happening.
	My last point relates to bureaucracy and I put it mainly to my hon. Friend the Member for Bury St. Edmunds. He was wholly right to say that much of the police service's time is wasted in bureaucracy. I know that because I have seen it in my own practice at the criminal Bar. May I remind the House of the need to ensure that power is not abused? I happened to be a Whip way back in 1983-84 when the Police and Criminal Evidence Act introduced various codes and the requirement that interviews should be tape recorded. I can remember what police interviews were like before tape recording, when verballing was commonplace.
	I also remember two of the difficulties associated with stop and search. I recall Sir John Wheeler as he now is, then Chairman of the Home Affairs Committee, campaigning to stop the use of stop and search because of the abuses taking place on the streets of London, which was particularly damaging to police relationships with the ethnic minorities. We need to be very careful when we set about dismantling some of the constraints that we have imposed on the police. There is a basic and beastly truth about life—if we give power to officials, it will almost certainly be abused. That is a basic rule of politics.

Christopher Huhne: Does the right hon. and learned Gentleman agree—this may serve as a salutary warning to his party's Front Benchers about some of the remarks that they have made in recent weeks—that trust between the minority communities and the police is crucial to effective policing? Without that trust, it will be impossible to secure the evidence needed to convict, or to secure successful prosecutions. On that basis alone, is it not entirely counter-productive to start ditching important safeguards of the kind that the right hon. and learned Gentleman has described?

Douglas Hogg: I agree with the first part of what the hon. Gentleman has said. It is indeed important to try to increase trust between the ethnic minorities and the police service. At present, it does not exist in many areas. I suspect, however, that the hon. Gentleman has been rather unfair to my hon. Friend the Member for Bury St. Edmunds. He and our colleagues are not suggesting the dismantlement of the main protections: I never thought that my hon. Friend said that. What I am saying is that we must be cautious, because many of those protections are there for very good reasons.
	Power will be abused. We should give power away only if we must, and if we must, we should ring it with as many safeguards as we properly can.

John Horam: I wish to direct the House's attention away from the rolling acres of Lincolnshire to the leafy suburbs of London, whose problems were mentioned briefly by my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) in response to an intervention from my hon. Friend the Member for Guildford (Anne Milton).
	There is a general perception on the Government Benches that there is little crime, or less crime, in the leafy outer suburbs of London, but that is not true. Indeed, the problem is that the more affluent parts of those suburbs are magnets for crime. My local police in Orpington, in the London borough of Bromley, recently carried out a successful operation involving a particularly villainous group of criminals who were feasting on an especially affluent part of my constituency. They did a brilliant job in apprehending all those villains, but only one of them came from Bromley. Most came from other parts of London, or from other parts of the country. The affluent suburbs which are supposed to be quiet and crime-free are often magnets for major crime.
	As that incident showed, we have an excellent borough commander in Bromley, in the shape of Chief Constable Charles Griggs. He was born in Bromley and lives in my constituency of Orpington, so he knows the ground extremely well, and we are very confident about his performance and that of his team. He tells me, "I must live within the resources that I am given by the Government, or the Mayor of London. There is little I can do about that, and I make the best of it." The fact is, however, that the resources at his disposal are far less than they should be. Although Bromley is the largest borough in London, it has only a little over 500 police officers. The further we go into the inner-London boroughs in concentric circles, the more the number increases. There are probably more than 600 in Lewisham, and I believe that Hackney has 800 or 900. I do not know the figure offhand, although the Minister may know it. In any event, she will understand my point.
	As has been pointed out by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg), there are major problems in city areas, both in affluent outer London and in less affluent inner London, which could be lessened by significant increases in the number of police on the streets. That is, of course, a product of the lack of resources that is evident in places such as Bromley. The problem is not just a lack of resources year on year—I am glad that the Government have adopted a three-year financing period—but sudden changes in the amount available within the year, which occur with little notice and little reason.
	I recently told Chief Constable Charles Griggs, "The promises about the number of police community support officers in my constituency are not being honoured. There are fewer than you said there would be. Moreover, the police shops that were to be opened in the wards are not being opened. People are disappointed. Expectations were raised and are not being fulfilled. Why?" He said, "I have just been told by the Metropolitan police that I cannot spend any more money in the current financial year, so I will have to postpone all that until the next financial year—if I can." Not only are the resources less than they should be, as many Members have acknowledged today, but there are sudden arbitrary changes in the amount that a police force can spend in a year. That is disconcerting and difficult for forces to handle, and it has an effect on the quality of policing.
	This debate will be followed by a debate on the local government settlement. I do not intend to stray on to that ground, but the fact is that boroughs such as Bromley suffer as a result of having not just fewer resources for policing but fewer resources for local government, which compounds the problem. Bromley has fewer resources for health care and schools than less affluent London boroughs. This is not a single but a quadruple problem, which exists throughout the spectrum of public services.
	Let us consider police resources in the wider context of the whole country. Public spending in London is only 31 per cent. of regional income, while in the north-east the proportion is 63 per cent. and in the north-west it is 54 per cent. Not only does Bromley suffer within London; London suffers in comparison with the rest of the country. That is perpetuated in the police settlement. My right hon. and learned Friend the Member for Sleaford and North Hykeham complained about a 3.1 increase in his area. My area has received an increase of 2.5 per cent., less than has been received by any metropolitan police area in the country except one. West Yorkshire, Manchester, Merseyside and Birmingham have all received larger increases. I cannot conceive why that is: surely London's crime levels are at least equal to those in other metropolitan areas.
	We will battle on, and do what we can with the resources that we have—my borough commander has admirably said that he will do what he can—but the fact is that those resources are inadequate. I hope that when my party comes to power, in 18 months or in two years, we will do something about that manifest unfairness.

Christopher Fraser: I want to focus on this year's police grant settlement in relation to the specific needs of rural policing. I am on record as saying in the House that Norfolk constabulary does an excellent job in difficult circumstances, policing vast rural areas as well as deprived towns with a history of antisocial behaviour. That is not an easy task, but the police perform it despite having to find some £3.5 million in efficiency savings. They have been forced reluctantly to go to the Government cap in hand to increase the amount of council tax that must be imposed on the county's taxpayers.
	At the end of last year, the Home Secretary assured the House that the Government were committed to ensuring that the police service was in the best possible shape to meet the heavy expectations placed on it. That commitment is welcome, but does the Minister agree that it is vital to recognise the special needs of policing in rural areas, and the particular demands involved in delivering a high-quality service to communities in which the population is sparse?
	I want to concentrate on two issues that the Norfolk police have told me are of key importance if they are to achieve their goals of reducing crime, the fear of crime and antisocial behaviour, increasing detections, and improving confidence. The first is specific grants. The rural policing fund is, unsurprisingly, hugely important in sustaining the force's capabilities, but it and other specific grants such as the crime fighting fund have not increased for several years. That amounts to a grant reduction in real terms.
	This policy reinforces the view held among rural forces and in the rural community, particularly in places like Norfolk, that the Government are refocusing resources in urban areas at the expense of rural areas. I am sure that the Minister recognises that that message is hugely damaging to police morale, and that it causes immense frustration—and, indeed, fear—among rural residents. How can such a policy be fair? Does it not demonstrate yet again that this Government misunderstand the countryside and fail those who live outside cities and major towns?
	Fear of crime is high in South-West Norfolk. Unlike in urban areas, some residents in my constituency can go for days, or even weeks, without seeing a police officer. People want help in tackling antisocial behaviour, traffic speeding through remote villages, enforcement of weight limits on lanes, petty thefts, and drug use in their communities. The chairman of a village hall management committee told me:
	"We have suffered thefts, boy racers, drug users, vandalism, gate-crashing, which abuses the hard work the committee puts into the playing field and hall. The police have been called on numerous occasions, but their policing area is so large they can take up to two days to arrive. We want to see more fully trained police, not just PCSOs."
	Agricultural theft is also a massive problem. The excellent organisation Farmwatch has had to resort to sending out a warning to farmers in its newsletter, advising them not to leave farm equipment out between jobs so that they do not fall victim to thieves looking for scrap metal. One constituent wrote to me:
	"I have been the victim of six separate thefts, despite spending more than £1,000 on additional security. The response from the Police is that it will happen again. The officer who attended this morning told me that last night there were 2 officers patrolling an area from King's Lynn to Hunstanton to Swaffham (an area over 1,000 sq miles). The chance of any thief being caught is almost zero. I am at my wit's end. Agriculture is a difficult enough way of making a living without people stealing the little we have."
	It seems now that even our local churches are not safe from this type of theft, as scrap merchants have begun targeting church roofs for lead.
	I also cannot mention rural crime without referring to the frequent raves residents in my constituency must endure. I will return to that matter later in the month when I present a ten-minute Bill to the House, seeking to address the shortcomings of current legislation on raves.
	Why have specific grants, such as the rural policing fund, not been kept in line with the rate of inflation? Why have the Government constrained rural police forces by imposing upon them a grant reduction in real terms? These are serious and pressing questions, to which rural forces and my constituents want answers.
	My second point is on the provision of protective services to cover emergency incidents, major investigations, work to combat terrorism and extremism, serious crimes such as homicide, public order incidents, witness protection and organised crime. Norfolk, along with other forces, is suffering from a projected gap of £5 million in protective services funding, despite an upsurge in serious and organised crime, a rise in human trafficking and increased drug-related crime. Does the Minister accept that rural police forces, like urban forces, have to deal with these crimes? Will the Minister also acknowledge that modern technology facilitates such crimes? Norfolk has pledged to be an intelligence-led force, but how can it achieve that if the protective services aspect of its remit is insufficiently funded? Does the Minister accept that a funding gap exists in this area, and what will the Government do to address it?
	Norfolk is collaborating with a neighbouring force to try to overcome this shortfall in resources, but it will be a few years before the positive effects are seen. What is Norfolk constabulary expected to do in the short term? Norfolk constabulary is committed to protecting the public to the very best of its abilities, but it needs the support of the Government and a fair share of the national funding pot to do so properly.
	I urge the Minister to reassure our police forces that the funding shortfalls that are causing considerable worry to constabularies such as Norfolk do not reflect a wider Government complacency towards the needs of rural areas. Finally, and most importantly, I urge the Minister to give Norfolk a better deal.

Crispin Blunt: I rise to debate some of the details of the police grant, with particular reference to Surrey. I am delighted that the Minister for Security, Counter-Terrorism, Crime and Policing is back in his place, and I am pleased that he acknowledged in his opening remarks that there is a particular problem to do with Surrey police funding.
	First, let me give some context. Surrey is supplying £5.4 billion-worth of taxation revenue to be spent elsewhere than in Surrey; therefore for a typical family of four, on average £20,000 each year is spent outside Surrey. So Surrey is paying more than its fair share towards expenditure elsewhere in the country. I shall examine the grant formula, and then look at the consequences of how it is applied to Surrey and point to some of the potential remedies that the chief constable recently recommended to the Minister.
	I wonder whether anyone present—with the possible exception of one or two Home Office civil servants—has any idea how the police grant formula works. It is based on a projected population multiplied by the result of the police basic amount plus police crime top-ups 1 to 7, plus police incidents top-up, plus police fear of crime top-up, plus police traffic top-up, plus police sparsity top-up.
	It is also revealing to examine the detail of what makes up the formulae. If a resident of Surrey sees that "single parent households" and "student housing" each appear under three different top-ups and that, to cap it all, under police crime top-up 7 a negative factor is applied for people identified as "wealthy achievers", they might then begin to get the general idea that all the formulae will take money and funding away from the county of Surrey. That has, indeed, been the case. One need only examine what has happened in respect of funding per head of population in Surrey since 1997-98 and the introduction of all the formulae and their consequences: the amount of money that Surrey has received from central Government has bumped along the bottom of the floor set by the Government. Indeed, the formulae were set in such a way that if there had not been a floor, I rather wonder whether Surrey would be getting any money at all from the Home Office.
	The formulae are entirely impenetrable to outsiders; it is impossible for them to find out what they mean in fact. What they mean for Surrey is that it has received no extra money in cash terms in Home Office police grant per head of population since 1997. In saying that, I might be guilty of misleading the House because the truth is that in 1997-98 the Home Office grant per head of population for Surrey was £57.80, whereas this year it has risen to the princely sum of £58.33, so it has in fact gone up by 53p per head in cash terms during the 10 years of this Government. Meanwhile, however, in order to deliver policing in Surrey, the council tax per head of population that goes to support the police has increased from £19.51 to £77.15.
	The Minister has said that the proportion of Surrey's police funding coming from the council tax payer is approaching half, but national non-domestic rates are also raised in Surrey. Only 40 per cent. of the national non-domestic rates raised in Surrey are then spent in Surrey, and that is scored as national expenditure for the purposes of the Minister's definition of national, as opposed to local, expenditure on the police. If one scored the national non-domestic rates raised in Surrey as local expenditure, about 64 per cent. of funding for the police in Surrey would be coming from Surrey taxpayers in one form or another.
	Surrey's position is extreme, and to see that, one has only to look at the different sets of formulae that were introduced in this House in 2005, all of which acted in precisely the same way to ensure that Surrey's expenditure was sustained only by the floor that the Government have put in place. I am afraid that the conclusion that my constituents and I are entitled to reach was summed up by the sedentary intervention by the hon. Member for Carlisle (Mr. Martlew). When Surrey's expenditure was mentioned he said, "They can afford it." Some £5.4 billion-worth—or, by other accounts, £5.9 billion-worth—is being exported from the county to be spent elsewhere in the country, and there comes a limit. That limit has been reached.
	As an aside, I shall examine the interesting additional rule 1 to be applied by the Home Secretary. I wonder why something similar to what applies in Wales does not appear to apply in England. The rule states:
	"The Home Secretary has decided that the grant provision under the principal formula for South Wales Police Authority"—
	which includes the capital of Wales—
	"shall be reduced by £2,383,426".
	Instead of being given to the police authorities in England and Wales, that money is simply redistributed among the Dyfed-Powys, Gwent and North Wales police authorities. If additional rule 1 is good enough for Wales and allows some adjustment to be made for over-expenditure in Wales's highly populated area to ensure that the policing challenges of its more rural areas can be addressed, why cannot something similar be done for England? Why cannot something similar be contemplated for Surrey, given the crisis that is overtaking Surrey police authority?
	The Minister will be well aware that I use terms such as "crisis" advisedly. Surrey's police force has been in the top end of all the performance indicators over the past 10 years, and it has supplied other areas with some distinguished police officers, Denis O'Connor and Ian Blair to name but two. I have accompanied both of them, and the chairman of the police authority, on delegations of Surrey Members of Parliament to previous Policing Ministers to point out that what was happening in Surrey was going to be unsustainable, yet year in, year out Surrey has sought, through imaginative policing and restructuring solutions, to stem the tide of its enormously difficult financial position. Above all, Surrey council tax payers have ridden to the rescue to ensure some form of sustainable policing in Surrey.
	We now face the extremely difficult consequences of this settlement. On 23 January, Surrey's chief constable wrote to the Minister, saying:
	"I am writing in unprecedented terms to express my professional concerns about the risks to public safety of people in Surrey over the next three to five years, if our funding position is not resolved urgently."
	Behind these formulae lies a basic absurdity in how the conclusion about how much money should go to Surrey is reached. The absurdity is that even if one accepts that the formulae are arrived at reasonably and are a reasonable assessment, they take no account of Surrey's location.
	If Surrey were moved bodily to the middle of Wales, which is a much lower crime area that has no major crime centres around it, Surrey would receive exactly the same amount of money under the formulae. As we have heard, 59 per cent. of serious organised crime in Surrey comes from outside it. I cannot better the chief constable's remarks about this. He says:
	"We are about to hit the tipping point where the majority of burglary, vehicle crime and robbery come from travelling offenders visiting Surrey from neighbouring high crime generating areas including London (currently at 46 per cent.)...I am also able to evidence a range of demands which are a direct consequence of bordering London. The Funding Formula takes little account of these factors".
	All that should be more than familiar to the Minister, and, as my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) was good enough to make clear, it comes from a police force that has performed at the top end of everybody's expectations in terms of its administrative efficiency.
	On 11 February, the Surrey police authority will have to set the force's budget, and this grant formula puts it in an impossible position. I understand that it cannot meet the Home Office's requirements on targets and performance within the current budget without busting through the capping limit. I understand that the proposals that will be made to the Surrey police authority on Wednesday for its decision on 11 February will become public. The chief constable has asked the Minister for feedback and urgent discussions on the prospects for a solution. The chief constable's solution is a special grant of £54 million over three years, which would serve only to give Surrey the average funding of other forces around London.
	The Minister's opening remarks directly acknowledged the fact that Surrey faces a particular problem, and he must take these concerns seriously. If he does not intervene, I would be astonished if the Surrey police authority is able to set a precept that does not smash straight through the capping limits. If the police authority proposes something above 5 per cent. I would expect him to cap it, but I must tell him that he would then have to meet the chief constable, the chairman of the police authority and hon. Members who represent Surrey constituencies to explain how he will address the problem centrally. Without a shadow of doubt, Surrey has a completely solid case, given the consequences of how the funding formulae have rolled out over the past 10 years.

Brian Binley: May I thank the Minister most sincerely at the start of my contribution—before he quickly leaves—for two reasons? First, I thank him for meeting representatives from across Northamptonshire's policing body. They were most grateful that he saw them, and I hope that he will have words for me tonight that show that the meeting was worth while.
	Secondly, I wish to thank the Minister for his opening remarks on the issue of sustainable community areas. He said that he was cognisant of the fact that the tardiness of the grant for those areas was a real problem. I do not want to talk about the east midlands, because that region has already been well covered by my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) and my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg). However, I make no excuse for speaking in detail about my own county of Northamptonshire and the impact on my constituency.
	The Minister will know the arguments, and I know that if he were in my position his arguments would be just as robust and strong as I intend to make mine tonight. I hope that from that perspective he will understand why I am raising the issue and that he will agree with me and go away and do something about it. He is the sort of man whom I would expect to think in those terms, so I am hopeful.
	The reason for making the case for Northamptonshire is simple. Northamptonshire police will receive an increase in formula funding of 2.5 per cent. The Minister knows that figure, but when it is added to the special grant funding—and we have to look at the whole of police funding—Northamptonshire will receive an increase this year of 1.4 per cent. That is less than this Government's tardy recommendation for police pay. How can we add the figures up for Northamptonshire? The Minister knows, I know and my electorate know that they simply do not add up. That is why I make this appeal to the Minister.
	The right hon. Gentleman mentioned the sustainable communities programme, and Northampton and the county around it have some of the fastest population growth rates in the country. That leads to some serious problems. The county faces two double whammies. First, it has a real problem with formula funding, which Ministers recognise, because they tried to introduce a new formula for police funding. While that helped Northamptonshire, it did not help some of the areas to which the Government are friendlier, and it will not do anything to improve our present position as the second lowest funded council in the country. The second aspect of that double whammy, which adds woe upon woe for the people, is that the Office for National Statistics has said—as the Government recognise—that there will be no growth in Northampton between 2001 and 2008, even though we are a sustainable communities growth area. That latter point is the first aspect of the second double whammy, and the second is that the area has one of the largest eastern European immigrant populations in the country. Northampton alone has had 10,600 immigrants from eastern Europe register for national insurance numbers in the past three years. That is the second highest in the country.
	I hope that I do not need to tell the Minister that Northamptonshire is a part of the Milton Keynes-south midlands growth area. The Government want us to have a 50 per cent. population increase, with 167,000 new houses to be built across the county by 2031, with most of them being built in the early years of that period. Indeed, planning applications for 45,000 houses are already in play, which will mean an increase in population of at least 100,000. And the police have had a 1.4 per cent. increase.

John Hayes: My hon. Friend makes a robust case for Northamptonshire, but Lincolnshire people look on that county with envy. We are the worst funded authority, as my hon. Friend will know. Does he agree that Northamptonshire and Lincolnshire share a dilemma with Surrey? Because of the gap created by lack of funding, we must raise the precept, but we cannot raise it beyond the cap. Is not that an impossible situation for police authorities, as the Minister must know?

Brian Binley: I am most grateful for your intervention and I welcome its robustness—

Mr. Deputy Speaker: Order. I have to make the point again to the hon. Gentleman who, despite some experience in this House, continues to fall into that little technical trap.

Brian Binley: I am grateful for that guidance, Mr. Deputy Speaker. I learnt my bad habits as a local councillor and I apologise.
	My hon. Friend underlines the point that both the east midlands and Surrey suffer as a result of formula funding, and that puts them in an impossible position. My hon. Friend will also know that when the Government's growth agenda is added on top of that, the position becomes even more impossible—if that makes any sense at all. I see heads wagging, but it is true. We need to find 1,100 additional hospital beds, 20 new upper schools and 60 new primary schools, to say nothing of leisure and sports facilities, doctors' surgeries, area health clinics, water, sewerage and the police to police the county.
	I pay tribute to Peter Maddison, the chief constable, for the work that he has done. The county's policing is improving, and the Minister will know that. We have done our bit, but we do not have the money to do the job that he wants us to do.

David Ruffley: Does my hon. Friend agree that it would be sensible for the Opposition to vote against the motion on the grounds that the formula is not being applied fairly, and the dispositions and allocations in the report are inadequate?

Brian Binley: I would be delighted if we were to proceed in that way, and that gives me a little hope— [ Interruption. ] It gives me hope, I can tell the Minister, because my party is obviously thinking in the right way.
	I have already said that my area has the largest number of immigrants from eastern Europe, but we also have one of the largest Somali immigrant communities—to say nothing of other communities. The consequences, for policing in Northamptonshire, include an interpretation budget that has increased from £53,800 in 2004-05 to £237,000 this year, an increase of 450 per cent. in four years. That has not been taken into account by the Minister—at least, not to date. I am hopeful that he might change his mind.
	The number of non-British people arrested last year increased by 4.1 per cent. It might be argued that that is a comment on the well-being of the immigrant community in Northamptonshire, and I am willing to accept that, but the rise was still well above inflation and above the money that the police are paid to deal with it.
	The number of hate crimes has risen by 10.1 per cent., which suggests the problems that are beginning to emerge in the area, which we need to note. I am fearful that the 1.4 per cent. in total increased funding will not allow us to deal with that issue in the way that we would wish.
	The Local Government Association has been especially supportive of Northamptonshire's case. In a submission to the House of Lords Economic Affairs Committee inquiry into the economic impact of immigration, the LGA pointed out that a substantial number of migrants have gone to towns such as Northampton that have little experience of receiving international migrants. It is much more costly when those involved are on a steep learning curve, and that is exactly where we are. That is a real concern.
	I do not need to tell the Minister that traffic has increased by 20 per cent. in recent years in Northamptonshire—the fastest rate of increase of any town in the country. That underlines the growth of immigration into the county and of the sustainable communities programme that I have already mentioned. When I tell the House that the chief constable talked about reducing the number of operational police officers by up to 400 over the next three years, Members will realise the difficulties we face.

John Hayes: My hon. Friend makes his case with the eloquence of Pericles and the strength of Hercules. Will he acknowledge that inasmuch as the formula is insensitive to local details and unresponsive to change it particularly disadvantages rural counties? They are changing, in some of the ways that he describes, not just in Northamptonshire but in Lincolnshire and elsewhere.

Brian Binley: I thank my hon. Friend for that intervention and I completely accept his comments. He gives me the opportunity to point out that on top of the growth in sustainable communities we face the general trend he describes, which adds to our difficulties.
	The Minister will know that we have tried to bring our case to the attention of the Government. I have already thanked him for meeting colleagues from Northamptonshire. We also met the Minister for Local Government. In November, I questioned the Home Secretary about underfunding and was delighted when she told me that I had made
	"an important point about the funding made available to police services and the nature of the formula in recognising changes in population".
	I was also delighted when she went on to say that she would
	"in the near future...be making announcements about next year's funding for police authorities and will bear in mind the issues that many forces have raised about the nature of population growth and how that is included in the formula".—[ Official Report, 26 November 2007; Vol. 468, c. 3.]
	You can understand, Mr. Deputy Speaker, how my hopes rose, but when the grants were announced what a tragedy for me to find that those were empty words and empty gestures. I am hoping against hope that the Minister can put things right this evening.
	As I said, Northamptonshire police received a total grant increase of 1.4 per cent. when formula funding and the special grant are added together. We have to do that, because community policing is part of the special grant provision. We cannot leave out that element and say that it does not matter. Of course it matters, especially in a county such as Northamptonshire.
	The truth of the matter is that the people of Northamptonshire increasingly believe that the Government are letting them down. Equally, and of more concern, the police in Northamptonshire believe that the Government are letting them down. I wonder whether the Minister will be honest with me— [ Interruption. ] I am sure he will. There is a way out of the problem; the Minister could work with his colleagues in the sustainable communities programme and tell them that there is a special special reason for doing something about my county, because 167,000 houses are being dumped—I use that word carefully—on the county in a very short time indeed. We are taking more than our fair share.
	I hope that when the Minister sums up the debate, he will tell us that he will talk to his Government colleagues who are responsible for the sustainable communities project to try to find ways of easing out extra money to ensure that Northamptonshire policing can benefit, because we face such a massive growth agenda. However, if that is not possible, the very least the Minister can do for me and the people of Northamptonshire is to tell us why funding has been so restricted. Why have we had such a bad settlement this year? If the Minister is honest he will tell us the truth—that when his colleague the Prime Minister was Chancellor of the Exchequer he made hay while the sun shone to such an extent that we now face massive financial problems, and that much as the Minister would like to do what I ask he is unable to do so, because the former Chancellor acted to the detriment of the people I represent.

Tony McNulty: I congratulate everybody who has made a contribution to the debate. As I said at the start, I certainly do not traduce Members who make a case for their individual area; that is absolutely right and proper and is, in part, the purpose of the debate. It might have been helpful if I could have put a little more context on the record before the avalanche of local special pleading—I do not mean that in a nasty way. However, I shall not waste time by giving context now as I would rather respond to the many cases that have been put.
	As the hon. Member for Bury St. Edmunds (Mr. Ruffley) rightly suggested, I would not necessarily disagree with many of the points he made. The settlement needs to be seen in a much wider context than just this year or successive years. It needs to be seen in the context of the whole issue of voluntary mergers, to which he alluded, and what we might or might not be able to do in those circumstances. I assure the House that we are not about to revisit enforced mergers—we have gone beyond that.
	There is also the issue of police pay, not just this year or in coming years. The House knows that my right hon. Friend the Home Secretary made it very clear that if we can reach a multi-year deal for the next three years or so, around the police arbitration tribunal index, and there is an assurance not to phase such a deal, it would give us at least the degree of certainty in terms of pay that authorities will rightly require over the next three years.
	Although there was a bit of badinage about the point, all those who suggested that although paperwork and bureaucracy are important it is time for more action and not merely words are right, too. Ever since the production of David Bowie's "Life on Mars" album and the period when the series that we have just enjoyed watching was set, we have been talking about trying to reduce the amount of paperwork and bureaucracy. I take Sir Ronnie Flanagan's point: police bureaucracy is rather like cholesterol—there is good and bad, and as the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) said, we do not want to throw out the good with the bad. We do not want to throw out the proverbial baby with the bathwater, in the sense of throwing out good, solid audit paper trails, which protect the defendant, among others, in legal processes, in the cause of getting rid of all paperwork.

Gwyneth Dunwoody: I think my right hon. Friend will find that there is no good or bad cholesterol but too little or too much, and that makes an apposite point.

Tony McNulty: As I tried to point out at the most recent Home Office questions, only to be charged the next day—by Simon Hoggart in  The Guardian—with having gone temporarily bonkers when I mentioned cholesterol in answer to a question on police bureaucracy, although we have sorted it out since—

Gwyneth Dunwoody: The bonkers or the cholesterol?

Tony McNulty: The bonkers bit—the charge that I was bonkers, however temporarily, as he was kind enough to say. Actually, I have just had my MOT from the occupational health people in this place—for whom we all have high regard—[Hon. Members: "What did they say?"]—What they said was obvious, but it is none of the House's business. In fact, they pointed out sharply that there is indeed good and bad cholesterol and kindly gave me three books to prove the matter. I was told that a combination of the two made up the overall index to show whether Members had good or bad cholesterol.
	I take the point that was made in respect of bureaucracy. It is irrelevant that the Police and Criminal Evidence Act 1984 was introduced under the Conservatives, but I repeat that it is wearing well over time and is doing well what it was intended to do. We are certainly finding that in terms of the PACE review. As I told the hon. Member for Bury St. Edmunds, as and when there is scope to update and modernise the measure we shall do so. That is what the east Lancashire pilot is about. The notion that portable records have to be given to each party is probably old-fashioned, so if through the pilot we can reach the stage of utilising digital storage rather than physical tapes, with appropriate password access for the limited number of parties who require the information, it will be an advance.
	Many Members who visit police stations—in a voluntary capacity, of course—will be struck by the extensive cupboard or room that is full of cassettes, because of the current requirement. Where we are going with PACE; what we may or may not choose to do with voluntary mergers; the points about police pay, both looking forward and otherwise; and the comments about paperwork and bureaucracy were all well made, and there was broad consensus across the House in each of those regards.
	Although I appreciate that urban and rural policing face different concerns and issues, all forces need to be alive to the importance of both rural and urban policing. Where distinctions exist even across the urban-rural divide between affluent and less affluent communities, there are still real policing concerns in both none the less. I do not subscribe to the notion that the more affluent the area, suddenly the less the requirement or need for policing, not least because, as some hon. Members have pointed out, there can be relatively low crime rates in some rural or urban areas that are far from affluent. The key for each area is that, between the Government, local police authorities and the chief constables, we get the balance and mix of policing right for that area.

Crispin Blunt: In the light of the remarks that the Minister has just made, will he at least therefore act next year, if this measure is passed tonight, to take out the rather peculiar subtraction factor for wealthy achievers that appears in the formula?

Tony McNulty: No, but I will happily charge some of the key officials in the Home Office to sit down in a locked room with the hon. Gentleman for about an hour to explain to him why his thumbnail sketch of what was right and wrong with the police formula was woefully inadequate even for a man of his capabilities. I am happy for officials to take him through the issues. When I walked away just as the hon. Member for Northampton, South (Mr. Binley) was speaking, I was checking with those in the Box that we had received Chief Constable Bob Quick's letter, which the hon. Gentleman referred to, and I certainly have and will respond. I will try to get in Chief Constable Quick and whoever else wants to from Surrey to talk to them in the same terms that I am talking to representatives from a range of other police authorities. I want to pick up the specifics of those local dimensions.

Douglas Hogg: rose—

John Hayes: rose—

Tony McNulty: I will give way to the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg), but I am afraid that, with the best will in the world, I will not give way to the hon. Member for South Holland and The Deepings (Mr. Hayes), because he has not endured these three hours in quite the way that the rest of us have.

Douglas Hogg: The right hon. Gentleman has been talking about officials and the formula. It would be helpful if he asked his officials to reflect on the fact that one of the problems in rural areas is the absence of the rapid deployment of reinforcements. That is not taken account of at all in the formula, with the consequence that, if an officer is out on duty and faces a violent situation, there is no back-up, and that is a particularly exposed position in which to be.

Tony McNulty: I take the point, which is, I suppose, a rough analogy to the sparsity point that relates to the next debate on local government finance. If the formula and allocation models are to be robust, they must be continually reviewed. I take those points seriously, but it is a matter of balance. For every plea made by an hon. Member for more money for a certain force, whether urban or rural, the money must come from elsewhere. It does not follow, not least for the reasons that I have outlined, that if more is given to rural forces, that comes from the pockets of urban forces—things are not so simplistic as that—nor is it the case, save for a very few areas, where each of our 43 police forces are either exclusively or largely rural, or exclusively or largely urban. Clearly, the forces are often mixed.

Brian Binley: How does the right hon. Gentleman feel that that applies to the sustainable communities project? The Government have asked my county in particular to be heavily involved in that project, yet they have not found the sort of money for services that growth requires.

Tony McNulty: The hon. Gentleman is not being entirely fair, but in many regards across the Government, that is precisely what has happened. I said in my opening remarks, and I have said the same to colleagues across the Government, that I do not think that the mechanisms governing such development have been robust enough in terms of establishing the community safety architecture and recognising that the required resources should grow with the communities, rather than afterwards. However, he is not entirely fair, and I was in on the ground floor in terms of the development of the sustainable communities plan. He will know that, across government, the criteria associated with education, health and a range of other services have been specifically bent and shaped around what we are asking the communities in growth areas to do. I accept that that has not happened in the case of policing, but even in that case, local authorities have launched initiatives, working with other partners, to make progress. If that policy is not as robust as it should be in Northamptonshire, we can talk about that issue another time— [ Interruption ]—or we can talk about it now if the hon. Gentleman wants to.

Brian Binley: I thank the right hon. Gentleman for his generosity in giving way. I would only add that the county council has already given £500,000 to the Northamptonshire constabulary for community policing, and it intended to give even more but was unable to do so because of the poor grant that it received.

Tony McNulty: I am sure that the burghers of Northamptonshire are very grateful for all that the county council has done so far and would ask it to try a bit harder in future. The hon. Gentleman is also wrong to characterise the settlement as being unfair to the east midlands. Of the five forces in the east midlands, Northamptonshire was just below in terms of winning or losing on the grant by a couple of hundred thousand pounds, I think. The other four forces all gained from the shift in the formula, however limited that was over the year. The east midlands special operations unit is doing an excellent job, and its work impacts on Northampton, as well as the core three forces and, indeed, Lincoln. I want its funding to be sustained. We have still not sufficiently addressed the level 2 protective services gap that the mergers debate was all about a couple of years ago. The hon. Gentleman will know, as an east midlands Member, that by their own lights, the five east midlands forces were, on any risk assessment basis, in more difficulty in terms of that services gap than any other force in the country. That is why we sustained the necessary funding.
	The hon. Member for Bury St. Edmunds and many other hon. Members made points about the freezing of special grants. I take those points on board, but it is a matter of making a sharp political decision. We could have gone in one or two directions; we could have tried to limit more than we did in the end the central core grant and limit even more the flexibility that our forces require by putting in more and more money and inflation-proofing special grants. As a deliberate policy, we chose to put more money through the central grant. The hon. Gentleman and the House will know that, save pretty much for the neighbourhood policing fund that funds PCSOs, the rest of the general grant is not ring-fenced, thus affording the flexibility to allow the forces to do what they feel that they need to do in policing.
	It is right and proper, as Members have said, that after successive years of growth—that is the bit that they do not mention—we have frozen special grants. We needed to make that decision. I think that, on balance, most forces have welcomed the fact that the bulk of the moneys have gone through the central police grant. Indeed, Tim Brain, the chief constable of Gloucestershire and the ACPO lead on finance was prayed in aid in commenting on this year's settlement. He says:
	"I am pleased that the Home Secretary has recognised many of the arguments that ACPO and APA have presented over the last few months in the settlement announced today."
	To be honest, he continues:
	"While this is not a generous settlement, there appears to have been a genuine attempt at striking a balance between competing priorities."
	That is exactly what we seek to do nationally, and it is exactly what forces will seek to do locally. I do not think that the Northamptonshire police are on the list to come and see me yet, but if they want to do so in the next couple of weeks, I am happy to meet them. I concur wholly about the service of Chief Constable Peter Madison; we wish him well in future.
	Policing is changing considerably all the time, as it must in order to reflect the communities that the police serve. I take the point about Surrey—I will be meeting Bob Quick—and points made by others about the range of services. As the right hon. and learned Member for Sleaford and North Hykeham kindly said, we have had extensive discussions with Lincolnshire police about their peculiar situation—peculiar as in distinct rather than strange. I have a meeting this week or next with them to take the matter forward. He will know that our Quest team, along with others examining the financial and other processes that police forces go through, is working with Lincolnshire police to help them; that goes beyond simply helping them to get over the budget process. As I have said to him—and to the hon. Member for South Holland and The Deepings, on occasions when he was in the room—we will do all that we can to work with them, but that work needs to take place within a framework.
	My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) mentioned a freedom of information request regarding Cheshire and its particular circumstances. If it relates to police authorities rather than local government reorganisation, and if she wants to pursue it with me after this debate, I am happy for her to do so.
	As Tim Brain, chief constable of Gloucestershire, says, the issue is and has always been priorities. We could either have frozen the central police grant or, as most hon. Members asked us to do, made at least some progress towards implementing the new formula. Having done the latter, we are moving towards increases of between 2.5 and 4.01 per cent; the latter figure relates to West Midlands police. No matter how tight or difficult the settlement is, it should be appreciated that we have at least moved towards the new formula, rather than adopting very narrow confines as we did in the past couple of years.
	I take the points that many Members made about trying to move to the new formula, but as ever with such matters, for every gainer under the new formula, there is a loser. It does not matter terribly to anyone here but London MPs, but the Metropolitan police will lose £33 million when the formula is fully implemented. As a London Member, I hope that that situation will be ameliorated, and that things will not be done in too much of a hurry.
	Today we have discussed priorities, context and the circumstances of individual police forces, and a number of things should be said in conclusion. However tight the next three years are under the settlement that we are voting on, they follow seven, eight or nine years of extensive and sustained growth in investment in policing. Happily, that has been contributed to by local government, in varying degrees, as well as by central Government. Some authorities have contributed more than others; there is a marked distinction between Surrey's ability and willingness to do so and Lincolnshire's earlier lack of willingness, although that is only one of a range of problems that Lincolnshire faces.
	The Norfolk police are also coming to see me, I think. If not, and if the hon. Member for South-West Norfolk (Mr. Fraser) wants to organise such a visit, I am happy to meet them. I take the policing of our communities seriously, as do the Government. That is why there has been sustained investment in the past seven, eight or nine years, and why we want that investment to continue through efficiencies and other methods. PCSOs would not have existed without this Government, nor would there be record numbers of police officers on our streets, notwithstanding hon. Members' points about recent police numbers.
	As I said last year, if a more substantive, grown-up and reflective debate is needed about how we finance our police, let us have it, and let it be cross-party. If further discussions are needed about what resources we need for our police forces—that could include debate on how to free the police from inappropriate bureaucracy and paperwork, or on a sustained pay award met in full by Government—let them happen too. As a result of this Government's sustained investment in the police over the past 10 years, our police forces are in very good shape, notwithstanding the tight settlement. We are building on that sustained investment. We can now have a cross-party discussion about how to police our communities in future only because this Government have made a sustained investment, for which I know communities across the country are enormously grateful. I commend the motion to the House.

Question put:—
	 The House divided: Ayes 280, Noes 171.

Question accordingly agreed to.
	 Resolved,
	That the Police Grant Report (England and Wales) 2008-09 (House of Commons Paper No. 265), which was laid before this House on 24th January, be approved.

Local Government Finance

John Healey: I beg to move,
	That the Local Government Finance Report (England) 2008-09 (House of Commons Paper No. 262), which was laid before this House on 24th January, be approved.
	On 6 December, I announced plans for Government grant allocation to local authorities in England. I announced grant to councils not only for the next year but—for the first time ever—for the next three years. Councils now know what they will get, and can plan and manage ahead. I also announced not only the core formula grant, but the allocation of 61 other grants from eight different Departments. Local government will therefore get a total of £2.7 billion extra next year, with overall increases in each of the next three years of 4 per cent., 4.3 per cent. and 4.3 per cent. That continues the inflation-busting rises given by the Government to support local councils each and every year since 1997.

David Clelland: I have to challenge my hon. Friend on his comment about inflation-busting rises. He has said that the settlement would
	"make the system fairer to authorities with a relatively low council tax base."
	Why, then, has Gateshead—91 per cent. of whose households are in bands A to C—been given a settlement of 2 per cent. when inflation is almost 4 per cent. and the average for the metropolitan authorities was 4.1 per cent.? Why is that four-star authority, which is often held up by Ministers as a beacon of good Labour local government, constantly given such poor settlements? What is wrong with the formula, and when will the Minister put it right?

John Healey: There is nothing wrong with the formula, which is the best and fairest way that we have established for distributing the money available. Last year we consulted on whether to alter the formula, and I confirmed the decisions that I took as a result of that in my statement to the House on 6 December.
	The fact is that next year Gateshead will get more than £6.5 million extra overall. Gateshead is also protected by the system of floors, which means that all councils in all regions will get an increase in the core formula grant in each of the next three years. I can tell my hon. Friend that there were, and are, those who argue against the floor system that the Government introduced in 2000. If I had listened to their arguments and representations, my hon. Friend's authority might not have been as well off as it is today.

Mark Hendrick: rose—

Alan Beith: rose—

David Howarth: rose—

John Healey: I shall give way to my hon. Friend, and then to the Liberal Democrats.

Mark Hendrick: My hon. Friend mentioned inflation-busting increases. For Lancashire county council, which is based in my constituency, we are seeing inflation-busting increases of 8.1 per cent., 5.7 per cent. and 5.1 per cent. for the next three years—well above inflation. However, for some reason the district council is getting increases of only 1 per cent., 0.5 per cent. and 0.5 per cent. again the following year. Why is there that shift of resources away from the district council towards the county council?

John Healey: The principal reason is this. In preparing for the spending review decisions that we took last year, we—with local government, including the Local Government Association—went through a detailed exercise in which we analysed the pressures that councils face in meeting population changes, service demands and people's rising expectations of local services. It was clear that, as many have told me, there are two main issues—social care and waste disposal—on which the analysis demonstrates that the pressures are likely to be greatest. The larger part of the increase in the core grant to local authorities this year is therefore going to authorities with social care and waste disposal responsibilities. That is one of the principal reasons why Lancashire county council has a larger increase than the district council.

Alan Beith: On that very point, the three district councils in my constituency are at almost 1 per cent., going down to 0.5 per cent. They are very small authorities, and with a settlement as tight as this, it is extremely hard for them to make the savings necessary merely to keep pace with inflation. Does the Minister understand that problem?

John Healey: I do indeed. A little later I shall talk about the importance of savings and efficiencies. I recognise that things will be different, and harder, for some councils than for others. Nevertheless, I think that the right hon. Gentleman would agree that there are pressures, particularly on social care budgets, and that we should recognise them. That is what we are doing in this settlement, to help councils provide the services that older people, in particular, need in the next three years.

Philip Dunne: The Minister says that he is confident about the fairness of his formula. How does he reconcile that with the announcement only last week, by his colleagues at the Department for Children, Schools and Families, that the formula for the dedicated school grant needs to be completely rewritten?

John Healey: Even by his standards, the hon. Gentleman has grossly caricatured and misrepresented the Department's announcement. If the hon. Gentleman is concerned about rural schools, he should know that we have always been clear in our guidance to local authorities with responsibility for local schools and about the additional support that we give authorities that have to support rural schools. Some such authorities will be smaller, by and large, than other authorities.
	If the hon. Gentleman wants me to check his point, I shall do so. However, I think that he will find that the additional money from the Department for Children, Schools and Families specifically to help areas under pressure to support local schools is £188 million this year.

Frank Field: I have had to express disappointment with eight of the Government's previous settlements as they affected Wirral. Indeed, I so expected that record to continue that I did not thank the Minister when he made the announcement. I should like to put on the record that at least one authority represented here is grateful to the Government for implementing more fully the formula by which they said that they would distribute the money. That formula was based on fairness.

John Healey: I appreciate my right hon. Friend's remarks—although I am a little taken aback by them. I hope that this year, unlike previous years, he will not have cause to revise his observations. At the centre of the settlement is the implementation of changes to the social services formulae that were decided in 2005, introduced in 2006 and double-damped for the following two years. We are moving to a situation whereby we allow those formulae, which represent our best assessments of relative needs, to reflect the settlements that we give. That is a fairer settlement, based on the principle of the analysis that we have carried out. Let me say to hon. Members on both sides of the House that although this is clearly the right thing to do, the general system of floors damping means that it will take not just this spending review but probably the next as well, before the formula is fully unwound. In that way, we can avoid the extreme changes and volatility that characterised the finance system before this Government introduced the system of floors.

David Kidney: It is true that the stability provided by a three-year settlement is welcome in Staffordshire. However, despite my best promptings Staffordshire has not responded positively to the White Paper about unitary authorities or enhanced two-tier working, and this year the shire districts, notably Staffordshire borough council, have very poor settlements. Does any part of the calculation of the settlements suggest that areas with two-tier local government should be encouraged to move to unitary authorities?

John Healey: The short answer is no. The slightly longer answer is that I am reluctant to get tempted into the territory of local government reorganisation, because this is a finance settlement debate.  [ Interruption. ] I am glad that my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) calls from a sedentary position, "That's very wise."

David Howarth: The Minister mentioned pressures. Cambridge city council is another example of a district council with increases of 1 per cent. and then 0.5 per cent.—well below inflation—and one of the pressures on it is caused by the Government: the concessionary fares scheme. That is a good scheme—but because Cambridge is an urban area in the middle of rural areas, the Government are offering £600,000 for a scheme that is costing it more than £2 million. On a net budget of only about £20 million, that is an enormous charge.

John Healey: The settlement that I announced on 6 December included £212 million extra from central Government to support the additional right to national free bus travel that people will have, which is of value to perhaps more than 11 million elderly and disabled people. The funding that continues to support the existing concessionary travel will remain, and will continue to be paid through the rate support grant, so this is additional funding just to cover the extra required to fund the new entitlement in April. Clearly, none of us quite knows what the impact of that will be, but the travel figures suggest that at present only 4 per cent. of people's bus journeys go beyond the county boundary. The cost of the additional journeys that we look to fund is about £1, so the hon. Gentleman could use that amount as a proxy for each additional journey.
	The hon. Gentleman has the figures and I do not, but if—through a specific grant to allocate this extra funding, which was what the LGA urged upon us—his authority has indeed been allocated £600,000 next year for the new national travel entitlement, that is the equivalent of about 600,000 journeys from Cambridge. Unusually from the point of the view of the Treasury and the Government, all the assumptions that we built into the aggregate of £212 million extra for next year err on the side of generosity—but we will have to see how it works in practice. The overall provision that we are making for people's additional responsibilities and rights is generous; even in his own local case, the hon. Gentleman would have to recognise that there would need to be a lot of additional journeys over and above those made and funded at present for it to be insufficient.

David Burrowes: How can this be a settlement for Enfield based on the principles of stability and fairness, when on the one hand the Government give a 4.5 per cent. grant increase, which appears generous compared with the rest of London, but on the other hand they take away £5 million in clawback through the dampening effect? That is the equivalent of the adult social services bill that the Treasury had previously determined was needed. How can the Minister justify that, and how can he look council tax payers squarely in the face and say, as it does on his press release, that we can make a £60 reduction in their council tax bills?

John Healey: Quite easily. The hon. Gentleman cites his constituency of Enfield. I have the figures for his authority here: a 4.5 per cent. increase in the core grant next year and 3.4 per cent. the following year, on top of an increase next year for all grants of more than £18.5 million. I hope that he will put pressure on his authority and say that he expects it, as I do and as do residents in Enfield, to make the same 3 per cent. efficiency savings next year as we expect in the rest of the public sector. Then it will have not only an extra £18.5 million for services next year but another £6.5 million on top of that—money that it can use to improve services or to keep council tax pressures down.

Lyn Brown: I welcome the continued increases of some 45 per cent. in local government finance by 2011. That is a stark contrast with the record of the Conservatives, who made real cuts in budgets of some 7 per cent.; as a local councillor during that time, I know just how difficult those days were. As I am not one for complacency, however, the Minister will understand if I press the case once again for Newham to be classed as an inner-London not an outer-London borough, because it has inner-London needs that are not yet reflected by its area cost adjustment allocation.

John Healey: My hon. Friend hits the mark in two respects. First, Newham will get a substantial increase in its overall grant from Government next year—more than £25 million. That gives the lie to the idea that this settlement works systematically against the interests of all London authorities. Secondly, she is right that there are problems with the area cost adjustment as a mechanism. She argued the case very hard for Newham to be part of a new arrangement. The fact is that we need to take a much more widespread look at how the ACA works, not only in London, and we will do that once this final settlement is passed by the House, as I hope it will be.

Bob Neill: Before the Minister departs from the subject of London authorities, will he, first, take on board the fact that Newham has the highest and best settlement of any London borough, whereas in the first year 29 of 33 are on the floor? Secondly, if he wishes to assist London boroughs, will he respond to the representations that have been made to include short-term migration figures in the settlement, which otherwise severely disadvantages boroughs such as that of my hon. Friend the Member for Enfield, Southgate (Mr. Burrowes)?

John Healey: First, the hon. Gentleman is wrong about Newham having the highest formula grant settlement of all local authorities in London; in fact, Barking and Dagenham has. Secondly, I share the concerns of many authorities about how good our population statistics are. They are the best and the latest that we can use, but there are clearly ways in which we can improve them to reflect general migration as well as general population changes. I will come to that subject in a moment, which I hope the hon. Gentleman will welcome.

Adrian Bailey: May I further compound my hon. Friend's earlier astonishment by saying that my local authority, Sandwell, is extremely grateful for the extra that it has received? Historically, it has not had the sort of settlement commensurate with its levels of need. However, one puzzling element of the settlement is the difference between the provisional and the final settlement. Sandwell was informed that it had lost £300,000 as a result of the redistribution of the funding mechanism for family law fees. Sandwell is incurring £400,000 in family law fees, and is somewhat mystified as to why it has lost out on that particular distribution. I would be grateful if the Minister would explain that.

John Healey: I am aware of my hon. Friend's point. It was put to me by a number of local authorities that I dealt with during the consultation, and also by the Local Government Association. The money in the settlement is intended to cover the full cost of family law settlements as a result of a change in approach by the Ministry of Justice. What we had not done, but will do—I shall confirm this—is reflect that situation in the baseline figures that we use to calculate the floor. I think that that may help my hon. Friend and his authority of Sandwell.

Simon Hughes: The Minister was kind enough to meet the leader of Southwark council, the leader of its opposition group, myself and others. Will he explain how the people of Southwark—it is a social services authority, so could be classified as a unitary authority in that sense—will get increases of only 2 per cent., 1.75 per cent. and 1.5 per cent.? Clearly, they will lose about 2.2 per cent. in real terms during the coming year—about £5 million. How can that be generous to social services, on which there is huge pressure, and how does it reflect the huge migration in a borough such as Southwark, where there is a population turnover of up to 25 per cent. a year?

John Healey: I did indeed meet the hon. Gentleman and representatives from the offices of my two colleagues who serve as members in his local borough area. I was impressed by the way in which he put the case, and the way in which the leader of the council and its Labour group jointly put their case. The short answer is that his authority benefits from the protection of the floor system. Secondly, his authority will have an interest, as we discussed, in ways in which we can increasingly improve the population and migration statistics at our disposal for making distribution decisions in the future.
	The third area, which the hon. Gentleman did not mention, but which we discussed in detail, was the concern the council has to continue progress in regenerating some of the areas where a lot still needs to be done, and to continue the programme started by the council when it was Labour led, which continues now that it is controlled by the Liberal Democrats.

David Drew: My hon. Friend knows as well as anyone in this House that we in Gloucestershire are still recovering from the impact of the floods, and we are grateful for some of the help that the Government have given us. However, in an answer to a written question from the hon. Member for Cotswold (Mr. Clifton-Brown) published in  Hansard on Friday, in which he asked about particular flood resilience help, my hon. Friend said, to put it in a nutshell, that money could be found from within existing resources. Does he accept that there are problems ongoing in the county, and will he look for ways in which specific grant aid might be given so that we can deal with the aftermath of what, in one way or another, has been a pretty horrendous year? What does he have to say about that?

John Healey: Resilience, to use the jargon, is a question of how homes and areas can be better protected against flooding in the future. It is increasingly a feature of the way in which we wish to see the planning system used where there may be a risk of flooding. With regard to housing or other development, resilience is principally a matter of the investment that may be available for the sort of defences that can protect areas and homes. My hon. Friend will know, because he has pressed his case equally hard with Ministers in the Department for Environment, Food and Rural Affairs, that we are set to increase investment in flood defences still further over the next three years, having doubled it already. That programme of work will bring a good deal of benefit in its acceleration of some important and necessary schemes.
	In this local government settlement, our concern is to reflect the circumstances and service circumstances of all local authorities. That is why the additional help we put in place for Gloucestershire and other areas since the summer floods has been paid alongside the funding system, but separately. That is a better and more flexible way of dealing with the matter for the future.

Rosie Cooper: While I appreciate that the Government will have increased funding to local authorities by 45 per cent. by 2011, and that the Tories made a real-terms cut in such funding in the four years leading up to 1997, I am sure that I am not the only one who tires of Tory-controlled councils continually complaining about Government funding while taking the credit for Government-funded initiatives. Does the Minister agree that councils such as my own, the Tory-controlled West Lancashire district council, instead of wasting time and resources on doing things such as building a new town hall in Ormskirk, ought to get their priorities right and invest their Government cash in front-line services? The council need to begin with the cemetery, which we badly need.

John Healey: To be fair to my hon. Friend's council, I cannot judge whether its proposals for new civic buildings are the right thing for the town. However, I can tell the council—she may wish to say this to it herself—that if it takes the steps that we support, and which we expect it to take, to do what it does more efficiently, to cut out waste and to do things in new ways, it will free up significant extra resources next year and each year during the spending review period, which it can then invest in the services that my hon. Friend rightly wants to see.

Gwyneth Dunwoody: My hon. Friend has made great play of the need for transparency, openness and efficiency, and suggested to all my hon. Friends that, although they are faced with real problems, only a certain amount of administration is required to ensure that all will be well. If he has such total confidence in his formulae and the suggestions of his Department, why did he refuse a freedom of information request to reveal straightforward figures on which decisions for the county of Cheshire have been based? Surely that does not sit too comfortably with what he has been telling us about the need for openness.

John Healey: The simple answer to my hon. Friend is that the matter concerned advice to Ministers and by tradition and convention, such advice does not fall within the remit of such requests. I have no problems with that. We will have the opportunity to debate the Government's proposals—I am sure that she will be first to speak in that debate and the first to intervene on me—and an order that seeks to restructure local government in Cheshire, a subject that she feels strongly about and has pursued closely.

Nick Hurd: rose—

John Healey: I shall give way one more time and then I will try to get off the first page of my notes.

Nick Hurd: I am grateful to the Minister for giving way; he has been extremely generous in taking interventions.
	The Building Schools for the Future programme is a core Government programme. Hillingdon council tells me that as a direct consequence of its grant, £15 million of capital spend it would like to deploy to support the programme is at risk because the revenue grant has taken them through the floor. An element of borrowing that was supported is now unsupported. Is that joined-up government, and what guidance would the Minister give to authorities such as Hillingdon that are in that predicament?

John Healey: It is joined-up government. The hon. Gentleman has received an inadequate briefing from Hillingdon council. I shall write to him to explain in some detail, but the fact is that where supported borrowing is awarded by central Government to local government, the revenue costs to support that borrowing are built into the settlement, as they were this year and as they have been before. That will mean that as part of the formula grant allocation the hon. Gentleman's council will have the amount of revenue to support the borrowing that it has been granted. It will have that even before the amount that it gets each year is increased to bring it up to the floor. The idea that authorities that are below the floor—the hon. Gentleman argues this for his local authority—are penalised and unable to carry out supported borrowing is entirely a misunderstanding of the system. If it helps him and his council to see the picture more clearly, I am more than happy to write to him in detail to set out what I have explained more clearly.
	Formally, we are debating the core formula grant distribution for 2008-09 that covers the totals of redistributed business rates and the revenue support grant, the final details of which I laid before the House on 24 January. The House will have the opportunity to debate the formula grant for 2009-10 and 2010-11 as usual each year. However, let me make it clear that the policy on three-year settlements means that I am unlikely to change the distribution that I have already proposed and published, except in entirely exceptional circumstances.
	This is a tight settlement, but public finances are limited for central and local government. Unlike six other departments, which have seen a reduction in funding over the spending period, local government has seen an average 1 per cent. real-terms rise. My distribution decisions mean that every council in every region will have an increase in core grant in each year over the three-year period. So, the settlement is tight, but it is also fair and affordable.
	There will be a rise of almost £1 billion in the core grant for councils next year, but if they make the same 3 per cent. efficiency savings that we expect of other parts of the public sector they will have another £1.5 billion available to improve services and to keep council tax pressures down next year. I hope that that approach has the support of hon. Members on both sides of the House and that all hon. Members will ask their authorities what they are doing to realise those savings.
	Central Government can and will help local government to cut waste and to do things differently and better. We are therefore investing more than £380 million over the next three years for council improvement and efficiency, including £185 million for the local government-led regional partnerships. However, councils must look for such improvement and efficiency not because Ministers say so or because it benefits the Government, but because it frees up cash for councils and is therefore directly in the interests of local services and local people.
	I want to equip local residents to challenge their council on whether it is running more efficiently, as they have a right to expect. From 2009 information on waste and better working will be set out with council tax bills, so that local people can see what is happening in their council's search for greater efficiency. I will consult on that later this year.
	In framing our spending plans, we have worked closely with local government. We are delivering the important reforms for which it rightly argued. Local government pressed for greater certainty and so we made the first ever three-year settlement. Local government asked for greater flexibility and so we will move £5.5 billion into grants with no restrictions on spending. Local government wanted less red tape and so we radically streamlined the targets system from 1,200 targets for some councils to about 200 national indicators for all. Local government analysed the funding pressures with us and so we covered them in the settlement and gave the biggest rises to councils with social care and waste disposal responsibilities. Finally, local government made the case for more financial freedoms and so we will give councils new powers for business rate supplements, the community infrastructure levy and transport charges alongside recent borrowing and trading powers.
	Following my consultation, I can confirm my proposed grant distribution in all major respects. I have decided to accept representations from the LGA and others, as my hon. Friend the Member for West Bromwich, West (Mr. Bailey) urged me to, and have adjusted the calculation of grant increases for the purposes of the floor to reflect the transfer to local authorities of full funding for family law cases, a matter on which the Ministry of Justice announced a consultation on 19 December. That adjustment does not affect the amount of grant available in 2008-09, which already covers that spending pressure. However, it ensures that the floor increase is calculated on a like-for-like basis that includes the funding change. I also made corrections to the data used where it was justified. In other respects, the grant distribution is as I proposed on 6 December.
	In particular, I can confirm that we will implement fully the relative needs formulae for social services, which were decided in 2005 and introduced in 2006 but have been damped over the past couple of years. We will make the system fairer by increasing by 2 per cent. each the size of the relative needs and relative resource blocs. We will set the grant floors to give all authorities guaranteed minimum increases over the next three years at the same levels as I announced on 6 December. As in previous years, the floors will be paid for within each group by scaling back the grant increase above the floor.
	Let me deal briefly with some of the other points that were raised in the consultation and that have been incorporated in associated announcements. Local authorities and hon. Members have raised the issue of population and migration data with me in their representations during the consultation and in debate. As I have consistently made clear, councils welcome the three-year settlement. They welcome the certainty and the knowledge about what they will get over the next three years. To deliver a three-year settlement, we have to use the best and latest data that are available consistently across the country at the time we calculate the three-year settlement. We therefore use the most recent set of local population projections produced by the Office for National Statistics, which were produced on 27 September 2007.
	I can confirm that we will put in place a cross-Government programme of work driven by senior officials from central Government and the LGA, and led by the national statistician. That will accelerate the work that has already begun to improve population statistics, including on a local level. The senior programme board will aim to meet for the first time this month. To support that programme of work a ministerial group, jointly chaired by me and the Minister for Borders and Immigration, will be set up, while the independent statistics board will ensure the quality of the statistics that are produced.

Simon Hughes: It is a consolation that the work will be done as the Minister has announced, although it is not necessarily an answer. When does he expect and by when will he, as the chair of that group, require the work to be completed and implemented for the first time so that it can impact on settlements in the future?

John Healey: The Office for National Statistics has set out a programme of improvements, which will be accelerated and amplified by the contribution that local government can make to the work. The hon. Gentleman and I have discussed the problem that faces us all. Local authorities often say that they have electoral registration data, GP registration data and national insurance registration data, but that they do not have sources of administrative data, such as those that I mentioned, that are consistent throughout the country and therefore form a suitable basis for the funding distribution decisions that local authorities wish to make. In the end, such data measure what they measure: they are not necessarily measures of population or migration but they can give us useful double-check and triangulation information. I hope that that can happen without undue delay, especially if the work is accelerated in the way in which my hon. Friend the Minister for Borders and Immigration and I intend. However, the data must have the statistical reliability that we all need.

David Burrowes: Will the search for more accurate population statistics mean taking full account of the impact of short-term migration, especially on councils such as Enfield? Will that lead to an opportunity for making a case for exceptional circumstances and thus readjusting the three-year settlement figure?

John Healey: In all honesty, I cannot give the hon. Gentleman the sort of guarantee or assurance that he seeks. Surely he accepts that, first, we need to improve the analysis and data that we have on population and migration movements. Our population is changing rapidly and becoming more mobile, and our sources of data struggle to keep up with that. We use the best and the latest that we have, but we clearly need to improve. Making a case for saying that the nature of a specific population imposes additional costs on particular public services and that that needs to be recognised in the distribution of funding support from central Government is a step beyond the data step. The decisions that I have been taking as part of the current settlement follow. If we can find better data and formulae, how and whether they are used becomes a question of policy.

Jim Cousins: What my hon. Friend has just told the House genuinely advances the debate and shows a way out of an intractable problem. However, he knows that his grant data are in three-year slabs, with no system of retrospective adjustment. Can he offer at least the possibility of a specific grant in future years that will correct matters for the vexed issue of population?

John Healey: Again, I cannot give my hon. Friend the specific assurance that he seeks. However, the Government make specific grants available alongside the mainstream settlement. As a member of the Treasury Committee, he knows better than anyone that it is important to improve matters, not only for the funding decisions that Ministers—not just me but those in other Departments—make, but because we must have better population data on which to base the 2011 census if we want to avoid some of the worries and weaknesses of the 2001 census.

Julia Goldsworthy: To follow the question that the hon. Member for Enfield, Southgate (Mr. Burrowes) asked, will the Minister confirm whether the group will specifically consider the impact of short-term migrants? Although I welcome the review, we knew that the EU would expand—that has caused many short-term increases in population—so why was it not established in anticipation of the expansion?

John Healey: Short-term migration poses a genuine challenge to us all. The increasingly obvious phenomenon poses several questions. First, many short-term migrants are light users of local government services and strong contributors to local economies and the local tax base. Secondly, it is fair to say that five, let alone 10 years ago, the sort of population change and mobility that we are currently experiencing would have been difficult to predict.

David Howarth: The Minister's point about migrants' burden on local government services being light may be true of the upper tier of services, such as social services and education, but it is not true of the lower tier, which consists of simple things such as rubbish collection. Does not that show how wrong it is to assume that the only movement of money should be from districts to counties?

John Healey: I have explained the reason for the main elements of the distribution. On migration in district councils in two-tier areas, the purpose of giving the Local Government Association a place at the heart of the work is to ensure that—as the LGA does—all council interests are represented, irrespective of type and political control. Surely that is right.

George Mudie: Given that 0.04 per cent. persuaded the Minister to take Leeds out of the working neighbourhoods fund, thus removing £42 million from Leeds in the next three years, and leaving Leeds as the only big city in the country without money from the fund, is he prepared to reconsider that statistical blip? Otherwise, the inner city of Leeds could suffer the consequences.

John Healey: I know Leeds well, although not as well as my hon. Friend. It has been successful in many areas in the past 10 years. We have carefully considered the methodology and the figures that we use. However, if one sets a threshold and criteria, some authorities will meet the criteria and others will not. Some authorities will come close to fulfilling the criteria and others will not. My hon. Friend's authority is one of 22, including mine, that have been eligible for money from the previous neighbourhood renewal fund but that are not eligible for payments from the working neighbourhoods fund. However, he knows that, to ensure that there is no cliff edge in funding, we will provide transitional funding of 60 per cent. for next year and 40 per cent. the following year. He should also bear it in mind that, by removing the strings that are attached to much funding for local councils, there is scope for them to make decisions about what they want to do to regenerate, improve the economy and make progress in areas such as some of those in his constituency.
	Today, I have published on the Department's website the confirmed allocations for next year from the working neighbourhoods fund. Twenty-two authorities will get transitional rather than full funding, and 65 authorities will get the full funding. In the next three years, our support, drawn for the first time from both the disadvantaged areas grant of the Department for Work and Pensions and our regeneration funding, will total approximately £1.5 billion, designed to concentrate our support on areas where deprivation continues to be most deep seated and difficult to dislodge.
	Also today, I have published on the Department's website the results of the refreshed consultation on the supporting people distribution formula, which closed last month. Following consideration of the responses, I am today confirming final allocations for next year.
	I am conscious that other hon. Members want to speak, so I turn to the local authority business growth incentive. Earlier this year, in the light of new legal challenges, I announced that the Department intended to reconsider all aspects of the approach used to distribute the resources available for year 3 of the scheme. We have also looked again at payments that were made previously for years 1 and 2. I have today laid a written ministerial statement confirming that, in order to avoid the additional delay and uncertainty likely to be caused by further legal challenge, we intend to reward authorities on the basis of a wider set of rateable value change codes than was used previously, in years 1 and 2.
	The statement also discusses year 3 payments. It confirms our determination to achieve the policy aim of providing incentives to encourage business growth for local authorities. However, the inclination of a small number of authorities to pursue legal action has created greater complexity, uncertainty and delay. Given that, I consider that it will be necessary to retain a portion of year 3 funding, as a contingency in this final year of the current scheme. I will make further announcements providing more detail on payments for all three years as soon as possible.
	Finally on announcements, following the comprehensive spending review in October last year, we announced that a third round of local area agreement reward grant would be available. I can now confirm that the total amount available will be at least £340 million, plus an additional £50 million available in reward grant for more deprived areas, via the working neighbourhoods fund.
	In conclusion, the settlement does what it says on the tin. It builds on 10 years of continued real-terms investment; it covers three years; it is tight, fair and affordable; and it reflects many of the arguments that were put to us by local government. It is now for local government to deliver.

Bob Neill: I thank the Minister for the usual courtesy that he showed in making the statement.
	I welcome one or two aspects of the statement. The first is the straight face with which the Minister managed to deliver it, which is always welcome. Secondly, I welcome his announcement that the Government are going to look at migration figures. As he will know, hon. Members from all parts of the House have repeatedly raised the issue in the Chamber, but have been repeatedly ignored. I therefore hope that his arrival in the Department will presage a genuine change of heart. I hope, too, that when he responds to this debate he will say that not only will the process be internal, but that senior representatives of local government will be involved in all the discussions and working parties from the beginning, because local government has thus far done far more work on the issue than any Government agency.
	I welcome, too, the optimistic way the Minister dealt with the Government's retreat in the LABGI fiasco. The simple truth is that the Government have had to back down because legal challenge by local authorities in the courts demonstrated that they had got it wrong. On the basis of welcoming the sinner who repenteth, I take the Minister's comments in the spirit in which they were meant. We hope to have a better scheme in future.
	I could not help but smile at the way the Minister presented the settlement as freeing up local government from the dead hand of ring-fencing, when ring-fencing as a percentage of expenditure has increased from one fifth to two thirds under this Government. The Minister's imitation of the grand old Duke of York is therefore immensely welcome.
	Finally, I thought that the Minister looked extremely cheerful on the pages of  Local Government Chronicle Plus, in the image of him smiling, standing before a weather map of the grant settlement. The hon. Member for Tyne Bridge (Mr. Clelland) raised a concern previously, so I am sorry that he is not with us, because a glance at that photograph would have shown a black cloud over Gateshead, a lot of black clouds over London—that will come as no surprise—and cheerful sunshine somewhere in the direction of Rotherham. I am sure that that is pure coincidence—or, as the right hon. Lady, the Minister of State, Department for Transport is here, perhaps there was a good result at Doncaster races.
	Having said that and having welcomed the fact that there is a three-year settlement, which gives certainty—that is one thing that local government has wanted—I remind the Minister that when I was practising as a barrister, I would sometimes sit in the cells with clients who would say, "What I want most of all, Mr. Neill, is to know where I stand." The Minister has ensured that local government knows that; indeed, he has given "three years' hard labour" a whole new meaning.
	Now that we have heard all the warm words about greater consultation, I hope that it will be carried forward, because the other serious point raised by Government Members—this is about migration, but the concern runs through the piece—is that if we are to have three-year settlements, to which there are benefits, it is all the more important that the methodology is accurate, robust and transparent. However, huge concerns remain on all those fronts.
	The Minister brushed over another significant anniversary this year that has a consequence on the settlement. This year, after 10 years of a Labour Government, is the year that statistics will officially confirm that council tax has doubled, with band D now at £1,374. Now I understand why the Secretary of State is not with us to support the Minister in making the announcement—there is a rumour abroad that she is away tonight modelling for the image that will replace Britannia on the back of the 50p piece, in celebration of Labour's achievement in doubling council tax.
	To move on to some elements of the—

John Healey: rose—

Bob Neill: I will happily give way to the Minister—I am sure that he will say something nice.

John Healey: I do not understand why the hon. Gentleman uses band D council tax figures, when fewer than one in six households in the country are in band D.

Bob Neill: I simply followed the practice that his Department has always used, including its press office, and which every independent expert has used. If the Minister wants to use the figures for bands A to C, as the hon. Member for Tyne Bridge did, which comprise 91 per cent., I should be quite happy to deal with that, too.

John Healey: Let me give the hon. Gentleman some other figures then. If he takes the average council tax rises across all dwellings, he will find that the rises this year are less under Labour authorities than under Conservative authorities, that council tax under Labour authorities is lower than under Conservative authorities and that both are lower than under Liberal Democrat authorities.

Bob Neill: The Minister makes an interesting point, but it is a shame that he did not mention certain other figures, which suggest that families will be spending an extra £53 on top of their council tax, thanks to this Government, and which demonstrate that, when considered across all tiers of local authority, Conservative authorities consistently come in at some £50 a year less than Labour authorities. The Government's attempt at obfuscation hides the real concern that underlies this settlement.
	The settlement does not address the key issues. We have debated the impact of migration at some length—it is a serious issue—but we have not dealt with the persistent transfer of financial burden and risk that has occurred under this Government. The settlement compounds a move that has taken place right across the period of this Administration to increase the financial risk placed on the local council tax payer and to reduce the exposure of central Government. That is illustrated by the way in which much of external aggregate financing is a recycling of the business rate. The amount of support for revenue support from general taxation is again reduced by the settlement, by a further 29 per cent. That is an enormous shift, and the burden is increasingly being placed on local communities while being taken off the balance sheet of whichever Macavity happens to be in charge of the Treasury. That is all part of the hidden smoke and mirrors with which the Government operate.

Neil Turner: The hon. Gentleman will be pleased to know that I am not going to claim bragging rights as a result of what happened between West Ham United and Wigan on Saturday. Will he tell the House, however, whether he is making a commitment on behalf of a future Conservative Government that shifts of money to local level would not happen, and that the Conservatives would give a lot more money to local authorities from central Government?

Bob Neill: I congratulate the hon. Gentleman on Saturday's result, because I would not want to see Wigan go down. If that prevents West Ham from getting into Europe, however, we will have to have a conversation outside.
	The key test that we want to apply is to determine whether a system is fair, transparent and open. However, the amount of ring-fencing that exists at the moment militates against such a system. Unfortunately, the methodology that underpins the settlement does nothing to reassure anyone about fairness or transparency.

Robert Wilson: Does my hon. Friend agree that fair funding is one of the main unresolved issues this evening? Let me give him an example. Reading and Wokingham authorities are next door to each other, yet Wokingham is the second-worst funded unitary authority in the country. It pays 80p out of every pound towards council tax, whereas Reading pays only about 50p. That is having a massive impact, particularly on social services. In Woodley, in my constituency, that is a major concern. This is all to do with the unfairness of funding, even within a local area.

Bob Neill: rose—

Mr. Deputy Speaker: Order. Before the hon. Gentleman responds, may I just say that these are very important and complex matters, but that long interventions—and, perhaps, long responses— mean that time is now moving on? A large number of people are still seeking to catch my eye.

Bob Neill: Thank you, Mr. Deputy Speaker.
	My hon. Friend's point brings me to an issue that I was going to address anyway, namely, the question of getting a transparent methodology. The hon. Member for Wigan (Mr. Turner) also referred to this. What we have now is not transparent. Some of us have spent years grappling with damping and double-damping. Before that, we had various other kinds of massaging, all of which is virtually incomprehensible to the average council tax payer. The present situation is coming rather close to a local government version of the Schleswig-Holstein question, and with similar consequences. Of the three people who understand it, one is dead, one is mad and perhaps the other is sitting in the officials' box; I do not know.
	The reality has a similar impact in other places. Comparisons that ought to be readily achievable on a like-for-like basis are not. We have just heard of an example in Berkshire. The Department has made it clear that emphasis is being placed on the relative needs and relative resources formula this year, and the Minister has said that particular advantage was given under the formula to authorities responsible for social services and waste disposal. Against that background, however, 29 out of the 33 London boroughs—all of which have such responsibilities—now find themselves on the floor. Tower Hamlets, Hackney, Lambeth and Southwark all now find themselves receiving about three times less support than that going to Rotherham, and about five times less than that going to Blackburn.

Sharon Hodgson: rose—

Bob Neill: I shall give way in a few moments.
	I do not believe that anyone would say that that fits any set of objective analyses, particularly in respect of the treatment of London, which has some of the most deprived local authority areas in the country. That does not seem consistent with an open, transparent and rational system.

Sharon Hodgson: I am grateful to the hon. Gentleman for giving way. He mentioned the complexity of local government finance, including damping and double-damping. People who are less accomplished than hon. Members participating in this debate might not understand the finer points, but what my constituents in Gateshead and Sunderland and I understand is that we now have a better and fairer settlement in the constituency than we had before.

Bob Neill: I am not sure whether the hon. Lady heard the observations of the hon. Member for Tyne Bridge, who spoke earlier and said exactly the reverse. Still, there we are, I suppose that that is the level of consistency that we should expect from Labour Members.

Sharon Hodgson: To clarify, I understand that my hon. Friend who spoke earlier represents Tyne Bridge. That constituency includes only a part of Gateshead, with the remainder being other parts of Gateshead and parts of Newcastle and Sunderland.

Bob Neill: It seems that it is damper one side of the river than the other. All I can say to the hon. Lady is that when I was a local councillor and was chairman of the social services committee in the 1980s, I was not under pressure to work out how I could fund the meals on wheels service; and when I was chair of an environmental services committee, I was not under pressure to increase charges to provide key services such as bin collection. Perhaps we can talk only on the basis of our experience, and it is increasingly the experience of many local authorities that this is a bad settlement that fetters them. Where authorities have been efficient, it seems that they have not just cut the fat, but had to get right down to the bone. That is the reality of this settlement.

Julia Goldsworthy: The hon. Gentleman mentioned the Minister's comments about increases to social services and waste authorities, but is it not the case that much of the increase in grant to cover waste will simply be recycled straight back up to central Government through landfill taxes?

Bob Neill: The hon. Lady makes a valid point and it is compounded by the Department's announcement earlier this year that it will no longer commit to a hypothecation back to local government of the revenue raised through that system. The hon. Lady is perfectly right; and the Government are making it worse. It seems to us that that is hardly a localising settlement. There is a lack of transparency in the methodology.
	Secondly, there is a failure to grasp key issues such as changing demographics. Pressures on adult social care, and increasingly on children and young people, were rehearsed last year by my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles)—and they are getting worse. As a consequence of medical advances, more people are living longer, which often requires more complex interventions. We are also aware of the need for much earlier intervention to help young people with particular difficulties. All those raise significant burdens for the responsible authorities, but they are not adequately recognised in the settlement. What we have seen, then, is failure to tackle the demographic time bomb in respect of adult care and young people, failure to make the system more transparent and, indeed, a shifting of ground on some key issues.
	All that in the present context inevitably gives rise to a suspicion, particularly when the methodology lacks transparency, that indices of deprivation can be changed or altered conveniently so that certain parts of the country suddenly become more deprived than they were, which does not fit with people's experience across the piece. If the Government really want the public to trust the system of local government finance, which I do not think they do at the moment, they would have to put it beyond suspicion that the system can be tinkered with to advantage one's friends and disadvantage one's opponents. That is a serious missed opportunity that should have been examined further when we moved towards three-year settlements. It will obviously be down to others to sort that out.

Andrew Slaughter: rose—

Bob Neill: I suspect that some reference to some part of west London is about to be made.

Andrew Slaughter: The hon. Gentleman might enjoy such a reference or he might be rather embarrassed by it, but he will have to wait for a while.
	All I have heard from the hon. Gentleman is a lot of waffle, preceded by an anecdote about serving meals on wheels in the 1980s. Will he address the central statistical point, which is that in 10 years of Labour Government there has been a real-terms funding increase of almost 40 per cent., whereas in the last term of the Tory Government there was a 7 per cent. real-terms cut? Is that not worth rather more than his anecdotes and waffle?

Bob Neill: I am grateful to the hon. Gentleman for not mentioning Hammersmith, but I must tell him that the statistic that hits most people, including those who voted for him, is that council tax has doubled under Labour. That is probably why the voters evicted the Labour council in his constituency so promptly when they last had a chance to do so, and why he will be next.

Andrew Slaughter: I can give the figures from the top of my head. During the first nine years of Labour Government, Hammersmith and Fulham council, controlled by Labour, increased its council tax by an average of 3 per cent. a year. That compared with 9 per cent. in the country as a whole, about the same as the retail prices index. As the hon. Gentleman wants to talk about Hammersmith and Fulham council, he may wish to explain why the budget that it is agreeing tonight makes £36 million-worth of cuts.

Bob Neill: I am sure that the hon. Gentleman will wish to applaud the steps taken by the current Conservative council—which has been able to reduce council tax by 3 per cent. in fulfilment of its election commitment—and to condemn his party's Government for having increased the floors by what is, by any measure, less than the rate of inflation, thereby imposing a real-terms cut in support for social care and waste services in authorities such as his own. He cannot have it both ways.
	My third and final point is this. We must view the settlement in the context of the broader picture of the burdens placed on hard-working families throughout the United Kingdom. All the surveys regularly show that council tax figures are among the top three or four issues identified by people who are concerned about the cost of living. As we know, disposable incomes are being squeezed more and more under this Government. Data produced today demonstrate that they have been reduced by some £1,300 over the last four years.
	If we take into account not just the household costs of mortgages and council tax, but the increasing number of charges being imposed for what were once core local government services—of which the Minister insists there should be more rather than less—we see yet more squeeze on people who, in most parts of the country, are hard-pressed already. The settlement does nothing to help that. It will not, I am sorry to say, assist hard-pressed local authorities; it will keep them in a straitjacket. More to the point, it will force householders and families throughout the country to fork out yet again, paying more and getting less. That will be the Government's epitaph, and whether it is written on the back of a 50p bit or on the back of their redundancy notice does not much matter.

Neil Turner: Let me begin by correcting something that I said in a point of order last Wednesday. I said that the hon. Member for Lancaster and Wyre (Mr. Wallace) was paid by the Tote. That information was given to me and I used it in good faith, but I have since checked it and found it to be untrue. I therefore withdraw the remark.
	I welcome the settlement. Obviously it is a difficult settlement, as we all knew it would be. As was pointed out by my hon. Friend the Member for Ealing, Acton and Shepherd's Bush (Mr. Slaughter), in the past 10 years there has been a 40 per cent. real-terms increase in the amount given to local government, and clearly it is not possible for that to continue.

Julia Goldsworthy: I wonder whether the hon. Gentleman knows what the 45 per cent. real-terms increase turns into once the ring-fenced schools budget is removed from it.

Neil Turner: Whether it goes to schools or to the rest of local government, it is still a 45 per cent. increase from central Government for local government services. How it is divided up is neither here nor there.
	The settlement puts the emphasis on ensuring that the local authorities with the greatest needs receive the most resources, and I hope my hon. Friend the Minister will ensure that that is continued in the next comprehensive spending round. The Local Government Association called for a three-year settlement which has been agreed to, and I think that all Members welcome that. It gives authorities stability, certainty and an opportunity to plan the services that they will provide over those three years.

David Heyes: I agree with my hon. Friend in welcoming the three-year settlement; it gives local authorities such as his in Wigan and mine in Oldham and Tameside the ability to plan in a way that has been absent for many years. Does he agree, however, that we still need to press for continued redistribution to the authorities that are most in need, such as his and mine?

Neil Turner: Yes, I do. We should look at the distance from target—the difference between the amount of money a local authority should be getting in accordance with the formula and the amount it actually receives. Even though both of our authorities have received very generous settlements, over the three-year period my authority will still have had about £25 million less than the formula says it should have had. The settlement is much better than in previous years, but we are still significantly underfunded. That is why I say that the next comprehensive spending review must work towards payment in full according to the formula, so that we can make sure that that direction of travel is continued.
	The Government have maintained the mechanism of floors, which I welcome even though my authority suffers from it, as the alternative would be much worse—not only for my authority but, possibly, for all local government. We should look back to what happened in Wigan in the 1990s: in one year, we suffered a loss—a cash reduction—in external support of some £15 million. That has not happened to any local authority in the past 10 years; not one of them has received one penny less in cash terms, let alone £15 million less. Therefore, I hope that the hon. Member for North-East Bedfordshire (Alistair Burt) will give a commitment in his winding-up speech that a future Conservative Government would continue with a floors arrangement. I should add that that cash reduction took place in 1993-94 and we did not manage to receive the same amount of money as before until the first year of the Labour Government.
	The formula is complex, as it is difficult to encapsulate in one formula all the different needs throughout the country; nevertheless, the Government and the Local Government Association negotiate on that formula, and the changes are worked in slowly in order to allow time to adjust. I strongly welcome the end to double damping. It is a tremendous achievement that the Minister has agreed to that—double damping was unsustainable and any phasing that was needed because of the changes to the personal and social services element of the formula could have been achieved by single damping.
	The needs and resources element in the formula is also welcome. Because an extra 2 per cent. has been shifted into that element, authorities such as mine and that of my hon. Friend the Member for Tyne Bridge (Mr. Clelland)—which face difficulties and have reduced ability to raise money from their councils because of the number of houses in bands A to C—are better able to fund areas of need. That is extremely important when we also take into account the gearing effect that can arise in authorities with a low tax base.
	It has been said—the hon. Member for Bromley and Chislehurst (Robert Neill) intimated as much—that this is somehow a London and the south versus the north and the midlands settlement, or an urban versus shire settlement, or a Tory versus Labour settlement. I do not believe that at all; it is none of those. It is a settlement that is about the haves versus the have-nots—and, quite properly, the have-nots have won. The London and the south versus the north argument is clearly wrong: Torbay has an 8.6 per cent. increase whereas Gateshead has a 2 per cent. increase, and Redbridge has a 5.2 per cent. increase whereas Liverpool's increase is 2 per cent. On urban areas versus the shires, Reading's increase is 2 per cent. whereas Lincolnshire's is 9.8 per cent., and South Tyneside's increase is 2 per cent. whereas Somerset's is 9 per cent. On Labour areas versus Conservative or Liberal Democrat areas, Labour Sunderland's increase is 2.9 per cent. whereas Conservative Rutland's is 12.7 per cent., Labour Salford's increase is 3.6 per cent. whereas Conservative Dorset's is 11.8 per cent., and Labour Wolverhampton's increase is 3 per cent., whereas Liberal Democrat Cornwall's is 9 per cent.
	I am sure that any hon. Member in this Chamber could produce a different set of statistics. The point I am trying to make is that saying this is north versus south, Labour versus Tory or urban versus shire is not a sustainable argument. The only consistent thing is that authorities whose needs are greatest are getting the greatest sums. That is the only pattern proven valid by the statistics.
	The movement on the needs and resources element is greatly to be welcomed, but it could be subverted if the floors were too high. That is why I was pleased when we reduced the floors to 2 per cent., 1.75 per cent. and 1.5 per cent respectively over the next three years. If we are to make the necessary changes and allow those resources to move to the authorities that need them at a rapid and sustainable pace, the floors need to be as low as possible. I hope that that approach will continue into the next comprehensive spending review round.
	The change from the neighbourhood renewal fund to the working neighbourhoods fund is equally welcome, and I congratulate the Minister on it. One of the things that this Labour Government have shown over the past 10 years is that ensuring that people get into proper, decent, trained work is the best and most sustainable way to tackle, and make a big difference to, poverty and deprivation in this country. Changing the focus from the broader renewal fund to the working neighbourhoods fund, which will tackle worklessness in areas of severe deprivation, will have a huge impact on those local authorities. Building that into the Department for Work and Pensions and having a single fund will be a major step forward in tackling deprivation in our authorities.
	I have always been opposed to capping, which was introduced by the previous Conservative Government. We toyed with getting rid of it, but we have had to go back to it for what are, in my view, slightly questionable reasons. Local authorities are answerable to their constituents, so we should not have capping. It should be up to that local—

Ben Wallace: Will the hon. Gentleman give way?

Neil Turner: Certainly.

Ben Wallace: I am sorry for intervening having just arrived, but I understand that the hon. Gentleman referred to me at the beginning of his speech, Mr. Deputy Speaker. Given that I was not present then, perhaps it might be in order if he were to repeat what he said.

Neil Turner: The hon. Gentleman will be able to read my comments in  Hansard.

Ben Wallace: On a point of order, Mr. Deputy Speaker. I understand that it is the custom of the House for an hon. Member to notify another Member should they refer to that Member in a debate or at any time. Given that I have received no such notification, either by e-mail or in writing, from the hon. Member for Wigan (Mr. Turner) following his scandalous accusations against me last week, surely it is in order that he repeat what he said in my absence.

Mr. Deputy Speaker: Obviously, the behaviour of hon. Members is a matter for them. I would just say to the hon. Member for Wigan (Mr. Turner) that in these circumstances it is normal for an hon. Member to advise another hon. Member if they are going to withdraw the kind of remarks that he made. Perhaps, on reflection, he might want to say a brief word about that. If not, the remarks are on record in  Hansard and they have been withdrawn. Unless he feels it appropriate to say a word about them, I trust we shall move on.

Neil Turner: In view of your good offices and good words, Mr. Deputy Speaker, I say to the hon. Member for Lancaster and Wyre (Mr. Wallace) that I was given the information in good faith and I used it in good faith. I did not have the time to check it, but I subsequently checked it and found it to be untrue. I have therefore withdrawn my remarks.
	I have always opposed capping. It is right that the people who elect a local authority should be able to make choices about the level of services and the council tax that they want. Some local authorities have enjoyed overfunding for several years. In the past, they will have put that money either into reducing the council tax or into additional services. If we restrict the amount of money that they can raise through the council tax, we are saying that their only option is to reduce services. That is not the right approach, and services—especially those relied on by the poorest and most deprived—should not be cut because the Government have requested that the council tax should be reduced. I urge the Minister to review the situation and consider ways in which floors can be removed, so that local authorities can raise the council tax to preserve their services.

Richard Younger-Ross: The hon. Gentleman makes a good point about capping. Does he agree that the situation is even worse in areas where the overspend is not due to decisions by the local authority but to impositions by central Government, such as the concessionary bus pass scheme? In some areas, the scheme will cost more than the authorities are being allowed by the Government. In small authorities such as Teignbridge, that can have a significant impact on the council tax and on other services.

Neil Turner: The hon. Gentleman provides just one example of what can happen, and we could all give other examples of what will happen if council taxes are not increased to the level necessary to preserve services. As I have said, it is important to have the direct relationship between the electorate and the council, and between the services that the council provides and the amount that it charges. That should be the responsibility of the council, not at the behest of the Government. I hope that the Minister will review the situation and allow local authorities to charge above the 5 per cent. level that has been suggested.
	The council tax system is a bad system. The bandings favour the rich and the failure to revalue locked in the growing inequities. It was designed to be unfair and it has become even more unfair as the basic band D council tax increases. The Lyons review proposed several good ideas and we should have a national debate on what kind of system we want for local government. The council tax is not sustainable in the longer term, so we need a system that is sustainable not for just 10 or 15 years, but for 30, 40 or even 50 years. We cannot just change the formula, because that will not solve the problem. We need a change in the system.
	The settlement is tight, and we always knew that it would be, but it is fair. It gives those authorities with the greatest needs the resources that they need to address the difficulties that their communities face. I congratulate the Secretary of State and the Minister of State on producing a local government settlement that does that.

Julia Goldsworthy: It is a pleasure to follow the hon. Member for Wigan (Mr. Turner), especially given his closing remarks, which will chime with much of what I have to say. He opened his remarks by saying that he welcomed the settlement; the Liberal Democrats welcome the fact that it is a three-year settlement, but we do not welcome the settlement itself.
	I looked back at last year's  Hansard and the then Minister—now the Minister for the Environment—heralded that settlement as nothing short of "revolutionary", which speaks volumes about the limits of the Government's ambitions. If the Government had been truly ambitious, we would have had a lot more to welcome today—as the hon. Member for Wigan said.
	Instead, we heard the familiar barrage of statistics, with claims and counter-claims about increases and cuts, although the Minister shows an impressive command of the statistics. One of the figures that sticks in my mind was mentioned by the hon. Members for Wigan and for Ealing, Acton and Shepherd's Bush (Mr. Slaughter): the 40 per cent. real-terms increase in local government funding over the past 10 years. However, neither Member took into account the fact that education is ring-fenced. If we take education funding out of the equation, there is still a real-terms increase of 14 per cent., but it pales into insignificance when compared with things such as health funding.

Andrew Slaughter: The hon. Lady cannot have it both ways. Is she saying that she opposes the substantial increases in school budgets that are transforming primary and secondary education?

Julia Goldsworthy: Of course I do not oppose those increases. All I am saying is that if we are talking about trying to tackle the pressures on many services, such as adult social care, the headline figures fail to capture the fact that real-terms increases in local government funding have not been as good as they seem when it comes to their capacity to meet additional demands. That fact is clear, and I am not trying to have it both ways at all.
	We can compare the local government funding figures with some equally well-known figures, to which the hon. Member for Bromley and Chislehurst (Robert Neill) referred: council tax has doubled over the past 10 years and will be more than doubled when the three-year settlement is taken into account. When we add to that the fact that take-up of council tax benefit is not 100 per cent., we can see that the pockets of many vulnerable people will be hit hard as a result of the settlement.
	Today, and in the initial statement in December, the Minister described the settlement as tight but fair and affordable. Our concern is that it will be more than tight for many people; it will be unaffordable for people who are yet again experiencing above-inflation council tax increases.
	The real disappointment is that there were huge opportunities for reform. Since the last settlement, the Lyons inquiry has reported to the Government and raised some valid issues, but they were kicked into touch by the Department. The proposals were not the most ambitious, but were simply suggestions about how to tackle some of the difficulties that people on the lowest incomes face in paying their council tax, recognising the fact that the tax consumes an ever-increasing proportion of their disposable income. Lyons proposed extra bands at the top and bottom of the scale, and the automation of the council tax benefit system to end the scandal that millions of pensioners who are entitled to the benefit do not claim it.
	Those proposals for interim improvements were rejected; instead we are left with a complex and centralised system. Members on both sides of the House have talked about the complexity of the formula. They have pointed out that central control has been retained and that the threat of capping still hangs over the head of authorities that feel they simply do not have the resources to focus on what they consider their priorities.
	Ring-fencing is still in place, although there has been some erosion. More than half the external income of local authorities is still based on ring-fenced grants. All the talk about damping and double damping, and the fact that it will roll into the three-year settlement, means that it has been difficult for many authorities to get to grips with what their situation really is, and it is extremely difficult for members of the public to understand what is going on.
	My local authority in Cornwall has been awarded significant increases, but because they are near the ceiling they have been clawed back to meet the damping on the floor; increasing sums of money are being clawed back. If everything is supposed to be moving towards convergence I do not understand why those amounts are increasing.
	The hon. Member for Bromley and Chislehurst pointed out that control and centralisation are being exercised at a time when the Government's contribution to local government funding is decreasing. More and more emphasis is being placed on business rates, and direct funding from central taxation is decreasing by 29 per cent. this year. No wonder we face such a difficult settlement. As a result, some areas will find it extremely difficult to cope with its impacts.
	My concern is that the settlement leaves many local authorities with a lack of flexibility, especially in terms of dealing with the key issue of demographic change. We welcome the Minister's announcement of a cross-governmental programme of work on the issue with the Local Government Association and the national statistician. However, I am concerned because the opportunity to predict some of those changes has been missed. We have seen the expansion of the European Union, and perhaps it would have been better if the changes that resulted from it had been predicted.
	I wonder whether the Minister will comment on how such things might relate to students. In my constituency, the town of Falmouth has experienced an 80 per cent. increase in the 18-to-24 demographic in the past three years. Clearly, that is very dramatic, and it is happening very quickly. So I very much hope that the cross-departmental review will consider issues such as the allocation of housing in the regional spatial strategy, and other significant projects that will clearly have an impact on populations.
	I also have concerns about short-term migrants. In rural areas there is a lot of transitory agricultural labour. As well as the extra work that will be generated—for example, in refuse collection, which my hon. Friend the Member for Cambridge (David Howarth) has referred to—I know from speaking to my local district councils that they have felt the pressure of trying to ensure that a lot of those migrant workers are accessing everything that they are entitled to, and that there is compliance with gangmaster legislation. That has taken up significant resources, which might need to be factored into some of the work that they will do.

Simon Hughes: My hon. Friend is making it clear that migration and population are big issues just as much in counties such as Cornwall as in inner London. Does she agree that until we have annual registration for electoral purposes that really works and is up to date, and possibly five-yearly censuses, as opposed to 10-yearly censuses, we will be always playing catch-up, whatever the best intentions? We need a much more effective census and registration process, both for electors and for the other people who may not have the vote in this country but who are entitled to live here.

Julia Goldsworthy: My hon. Friend makes a very good point.
	Whether the real cost of providing services is being recognised is an issue, and the best example of that was mentioned by my hon. Friends the Members for Cambridge and for Teignbridge (Richard Younger-Ross): concessionary bus fares. That is a new responsibility, and local authorities are concerned that the real cost simply has not been met. My hon. Friend the Member for Cambridge was trying to make the point that the responsible authority must pay for the outward journey. There is a lot of commuting into Cambridge, and it is paid for by the authorities outside Cambridge, but the return journeys are paid for by Cambridge city council. Clearly, that will have a massive impact on its costs. Can the Minister tell me whether the Government have assessed the true cost of the scheme, as well as the cost of extending it? If they judge that there will be a shortfall, will they meet it?

Richard Younger-Ross: Is my hon. Friend aware that in Devon the scheme has been extended in the past to allow the companions of disabled people to travel? With the new scheme, because funding is so tight and given the fear that, with a good summer, so many tourists will arrive that it will run into deficit, the allowance for companions has had to be withdrawn. Therefore, under the Government's proposals, fewer disabled people will be able to travel.

Julia Goldsworthy: My hon. Friend makes a good point. I wonder whether there will be regional differences, because areas with a large number of visitors from within the country will face greater costs. That is the same for my local authority as it is for my hon. Friend's.
	Clearly, although the Minister spoke about recognising additional cost pressures, those pressures and costs are increasing faster than the grant increase. Waste is an example. The Office for National Statistics corporate services prices index indicates that prices are rising annually well above the settlement figures, at between 5 and 7 per cent. per annum.
	Of course, the obvious example is adult social services, where the gap between funding and demand is growing quickly, where cost pressures are increasing rapidly, and, of course, where the human cost of failing to meet those cost pressures will be felt most acutely. Last week's report by the Commission for Social Care Inspection made it clear that local authorities across the country are facing similar challenges. Two thirds of local authorities now support only those who have substantial and critical needs, even though councils overall have increased their expenditure on social care for adults in real terms.
	The UK's population is ageing rapidly. The change is more rapid in some parts than in others, but it is clear that Government financial support does not reflect that adequately. The Department of Health's response to the report was yet another investigation. Perhaps the Department for Communities and Local Government should consider its response, too. The social care reform grant, to which the Minister referred, is back-loaded. A lot of the resources are loaded towards the end of the three-year period, but the Commission for Social Care Inspection has suggested that they should be front-loaded. Will the Minister look at the issue again when he deals with the remaining two years of the settlement?
	I am also concerned about another way in which vulnerable people will be affected. The Minister mentioned the supporting people budget, to which there will be a real-terms year-on-year cut of 12 per cent. by 2011. The programme assists the elderly, those with disabilities and mental illnesses, and those fleeing domestic violence. A lot of those people will go on to rely heavily on adult social services. That is yet another pressure.
	The settlement is not just tight; it badly affects the most vulnerable. My concern is that there may be more cost-shunting from other services. Indeed, that is already apparent. A gentleman whose wife is terminally ill with a brain condition came to see me a couple of weeks ago because an argument is taking place about who is responsible for providing his wife's care. To begin with, it was funded under the continuing care programme, then responsibility was transferred to adult services. The hours of care were then cut, and then he had a telephone call to say that responsibility for provision was moving back to the primary care trust. Clearly, it is an incredibly distressing time for him. He is trying to work to support his family, but he has no certainty about what support he will receive and who will fund it. The concern is that such arguments will continue as cost pressures get ever tighter.
	Another issue of great concern is the effect on excellent cross-agency working. Representatives from local children's centres tell me that the first cuts that they are experiencing are to cross-agency working. Health agencies are pulling out because they cannot support the costs. My concern is that local authorities will soon feel the same. We are losing huge benefits.
	There is a familiar theme to all those problems. Responsibility is increasingly being passed to the front line, but without adequate resources. The Government are not being honest about the real pressures facing local authorities. That is reflected in the fact that their grant increase is 1.5 per cent. or less in real terms over the next three years. However, the Government are working on the assumption of council tax increases of up to 5 per cent. If there was parity in funding, council tax increases would match increases in central Government grant. There should also be parity in the increases for Government Departments. Overall, there is to be a 2.1 per cent. real increase in public expenditure. There is to be a 3 per cent. increase for education, 3 per cent. for transport, and 3.7 per cent. for health. There is no parity there.
	The Minister says, somewhat disingenuously, that local authorities could deliver council tax cuts if they were more efficient, but local authorities are performing well on efficiency targets. According to the latest published figures, councils are set to beat the overall efficiency target by 41 per cent., achieving £4.25 billion of savings, compared with a target of £3 billion. The figures are even more pronounced when we consider cashable efficiency gains: councils beat their target by 122 per cent. In any case, assumed efficiency savings are factored into the settlement that we are debating.
	In many respects, local authorities are doing better than the Department. One need only consider the 60 per cent. overspend on the FiReControl IT project to realise that perhaps there are lessons that the Department for Communities and Local Government could learn from local authorities, rather than it being the other way round. The Government are using the efficiency debate to sidestep the accusation that none of their actions on local government finance sit easily with their proclaimed fervour for the devolution agenda. There is no transparency and, most importantly, it is difficult to see a clear line of accountability.
	It would be better if the Government acknowledged that council tax is fundamentally flawed, and that there is desperate need for its reform. The Conservatives accept the need for reform but have not come up with an alternative. The Government's performance is disappointing, and again real opportunities for effective change have been passed up. The local government finance system should be designed to be fair to local taxpayers and open in its procedures and finances, and it should reflect priorities at local level. It must be local, so that decisions are made and cash is raised in a manner accountable to local voters, as they simply do not understand how that is done at present. It must be fair, so that it reflects people's ability to pay—the current system does not do so—and open, so that people can see what they get, and could reward or punish their local council accordingly.
	Local income tax will achieve much of that: it is fairer on the individual, because it is related to their ability to pay; there is no need for council tax benefit, so millions of people who are entitled to it but do not claim it would benefit; and it is a more buoyant form of revenue, which would give authorities the opportunity to focus on their priorities. However, it is not enough on its own. We need a fundamental change in the balance of central and local funding. The gearing system means that 75 per cent. of local expenditure is still funded centrally, and only 25 per cent. is raised through council tax, which is one reason why there have been larger increases in council tax. Addressing that balance would make the system more transparent. We need to move away from capping and ring-fencing.

Neil Turner: Does the hon. Lady not accept that if the gearing were shifted, we would have to ask the local council tax payer for an awful lot more money in the first place? Is she proposing that council tax payers should pay substantially more?

Julia Goldsworthy: We have proposed cuts to national income tax as compensation, so there would be a much clearer relationship between what people pay for local services and what they receive. As I said, we need to move away from capping and ring-fencing, and we need a simpler grant mechanism, so that people can understand its relationship to the services that they receive. Surely that is in the spirit of the central-local concordat: indeed, that is what it was designed to achieve. If the Government do not make those changes to local government finance, they will reveal their true colours. They are not committed to devolved decision making, because they are not putting their money where their mouth is.
	The Minister who introduced last year's debate said that council tax was not broken. Does the Minister of State accept that this year's settlement pushes it further towards the point of no return, if it has not reached it already? Surely it is time the Government faced up to that reality.

George Mudie: I shall be quick, because a number of Members wish to make speeches.
	I raised my concerns in an intervention on the Minister, so he will not be surprised to learn that, while I welcome the statement, I am upset—and so is the city of Leeds—by the fact that Leeds has been excluded from the working neighbourhoods fund. He was dealing with statistics when I raised the matter, but some of his statistics put a gloss on the problem, so they should not have been used. If it had been in the fund, Leeds could have expected to receive £54 million over three years. In fact it will receive £12 million. The first year, it will receive over £8 million; the second year, it will be down to £4 million; and in the third year, it will receive nothing. A ratio of 60:40 sounds good, but it disguises or masks the fact that in the third year, Leeds will receive nothing at all from the fund for work in deprived neighbourhoods.
	It gets worse. The Minister suggested that funds from the Department for Work and Pensions are tied to the working neighbourhoods fund. The £42 million that we will lose could be the tip of the iceberg if, as a result of the linkage, we do not get into the relevant list of authorities and thus do not get the DWP money. I should like the Minister to deal with that figure when he replies to the debate.
	On the same issue, in his final sentences, the Minister indicated another, I think, £30 million—perhaps it was £50 million—was going in to deal with immigration in cities. He said that he had put the figure on the website, and that that money would be distributed. However, it will be distributed only to those authorities in the working neighbourhoods fund, so that is another pot of money that could be used to help the Government and Leeds city council, which is not Labour-controlled, to deal with the huge problems in inner-city Leeds. I would like the Minister to send the leader of Leeds city council and me information on exactly how much we will lose in the three years.
	The worst aspect is the fact that we lose the money because of maths—we come down to statistics again. There is a calculation that means that 20 per cent. of areas have to be in the most deprived 10 per cent. nationally. Leeds has 95; if it had 96, it would have qualified for £52 million. In three years' time, it will get nothing because it is one short. That 95 as a percentage of 400-odd works out at 19.96 per cent. The city is excluded for the sake of 0.04 per cent. The Minister will say, and I understand this, "That's tough. When you draw a line, you're either on one side of it, and you cheer"— as my hon. Friend the Member for Wigan (Mr. Turner) cheers—"or you are on the other, in which case, tough!"
	As the hon. Member for Falmouth and Camborne (Julia Goldsworthy) knows, because we have debated the issues in Westminster Hall, if people meet the criteria for social care and home care, for example, they get it. What is not said is that, if people do not meet them—many do not, despite their grave problems—they do not exist as far as the Government and local authorities are concerned. There are 149,000 people in deprived areas of Leeds who in three years' time will effectively not exist. There will be no help for them because they have not qualified by 0.04 per cent.
	The other aspect is about working neighbourhoods funding and trying to get people into work, which is laudable. In Leeds, 63,000 people are on benefit of one type or another, and are not working. That is the fourth highest level in the country, but Leeds does not qualify for working neighbourhoods funding because of 0.04 per cent.—which will be on the Minister's gravestone at some stage.
	I finish by saying this. I plead with the Minister to come to Leeds. I will personally drive him around; he can bring his whole office for protection if he likes. I would not have to take him anywhere other than my constituency—it is desolate. I have made speech after speech, and got into trouble with Whip after Whip, because of what I see in my constituency in the inner city after 10 years.
	Every city bar Coventry, which is smaller—Liverpool, Newcastle, Manchester, Birmingham, Middlesbrough, Newcastle—gets the funding because big cities in the western world have prosperous centres, prosperous suburbs and dire poverty in the middle. We all know that, but in the eyes of the Government Leeds has done what New York, Paris and Rome have not managed: its inner city has disappeared. That happened at an administrative stroke because of 0.04 per cent. Poverty, deprivation, crime, drugs, bad health and bad housing have been abolished in Leeds—hallelujah! The reality is pretty dire.
	The Minister has said that he is not content with statistics. I hope that there will be a review to see whether the statistics justify taking Leeds, one of the major cities of this country but one with severe inner-city problems, away from Government help on those important issues.

David Curry: The first thing to say about this settlement is that it takes place under the iron hand of capping. Capping works, because local authorities do not have to rewrite their budgets, and, as this is a three-year settlement, the next three years will be governed by capping—that is as plain as a pikestaff. Secondly, the reason why that is happening is that the Government's finances are in a mess. Years of profligate and ill targeted public spending increases have led to the current difficult prospects. The Government say that the settlement is tough but fair, which is a very British formulation. In a sense, council tax is atrophying because of capping.
	The most interesting background to this matter is the report by the Audit Commission, "Positively charged", which shows that £11 billion now comes from fees and services. I did not realise that car parking would emerge as one of the great functions of local government, although it is certainly one of the major functions of Network Rail. That is an important development that can have a disproportionate impact. Some councils are in a position to benefit substantially from charges while others are much less so. The Government have picked at the Lyons report, and Sir Michael has moved on to grander things. He must be disappointed at the small amounts that have been picked out of his report.
	I have to say to my own Front Benchers that to the extent that Tory policy is represented by Salome, she is very largely still clothed, and I look forward to having greater revelations than just the ankle, which appears to be the proposal to threaten councils with local referendums so that local people impose the capping instead of the Government, with precisely the same effect as far as councils are concerned. Meanwhile, the Liberal Democrats recite the case for local income tax rather like old believers in a remote monastery hoping that somebody will eventually attend the services. It has very little to commend it other than the fact that it exists as a policy, which is somewhat distinctive for that party. On business rates, a total silence has descended right around the Chamber—it is a subject that does not speak its name any more.
	Three-year settlements are even more subject to things going wrong than annual settlements, and the problems that are faced could get worse. We see rising commodity prices, most particularly in energy, but I also draw the Minister's attention to what has been happening to food prices and the impact that that could have on the costs of local government. We see the relentless demographic pressures. Care of the elderly is the most obvious example, and the cuts there are the easiest to make because they are the least visible. Cuts in education are pretty visible because an articulate group of people has an interest in fighting them. In social services, the impact is much more scattered and so the ability to resist is much reduced. We could see more abnormal weather phenomena, as the Environment Agency calls them. One need only drive on any road that is not a main road to see its deteriorated, rutted, pot-holed condition.
	The move to single status has a major impact on many local authorities. Let us hope that in seeking to deal with this settlement at least some councils will have the courage to remove some of the surplus school places, which are a major problem. However romantic it might be to save village schools from closure, the fact is that we cannot afford to maintain in the education system capacity that is not needed.
	The Government make great play of what they have done about devolving power—there is supposedly a great devolution agenda. However, as in the case of Lyons, there is precious little real substance. It is desirable, but it does not deal with the issues of financial resources and autonomy, or redress the essential balance of power and competence. It remains a sort of constitutional alms-giving, handed down by Government to a grateful and supplicant local authority.
	I want to raise one local issue. On concessionary bus fares, the Government have not got it right, and I hope that for the next two years of the scheme they will look again at the formula. This is bad government. Places such as Harrogate and Scarborough are in exactly the same position as Cambridge; a huge shortfall is projected from any reasonable forecast. The Minister is not going to alter that now, but I hope that he will consider it for future years. He should realise that for district councils, which have a budget of £20 million to £25 million, little pressures such as damping arrangements costing £200,000 or increases in Audit Commission fees accumulate into a significant hit.
	Huge issues remain to be addressed in local government: how accountability can be achieved in the important public services of policing and health, one of which has no level of accountability at all; the assertion of representative democracy, rather than the irresponsible empowerment of national quangos or small local boards; and how agendas based on choice can be made manageable and affordable. The settlement does not address those crucial issues and, in effect, the devolution proposals do nothing else.
	Meanwhile, we drift. The Government will not take decisions. The Opposition are by and large happy to impale the Government on the unpopularity of council tax increases and coo as far as devolution is concerned, and the Secretary of State is a cheerful cooer. Concordats get us nowhere. I leave the Minister with the thought that there have been two famous concordats in history: one between the Pope and Napoleon, and one between the Pope and Mussolini. I hope that this one has a better fate than those two did.

Jim Cousins: I came to the debate thinking it likely that I would vote against the Government on the settlement. In Newcastle, there has been a failure to recognise a new and growing population of short-term residents, many of whom are young and many of whom have special needs. They are not counted properly in the figures. Tonight, my hon. Friend the Minister has made a statement that gives me some hope that we will sort that problem out. I was also concerned about the Government backing down on the issue of giving councils an incentive to grow business in their area. I acknowledge that my hon. Friend told us that he will move forward on that front. He will make changes, and he will not back down in the face of legal action.
	I am also concerned that we cannot build long-term success for children and families and people with care needs in a city such as Newcastle on the basis of minimum grants that get smaller year by year. In his opening remarks, the Minister made a brief reference to the Government's review of care. I hope that when he replies, and at a later date, he will come back to that point because it is important.
	I say to the hon. Member for Falmouth and Camborne (Julia Goldsworthy) that we have a Liberal Democrat council in Newcastle, and it has just said that because of the minimum floor, it will have to cut care provision, including the closure of a respite and day centre care home in Shieldfield in my constituency. I also say to her that 300 yd from Napier house, the respite care centre that is being closed down, the same council has bought out the lease of a run-down furniture warehouse at a cost that I believe to be equal to the entire cost of the care budget cuts that the council is considering. Those decisions cannot be passed off on to the Government. This Liberal council says that it cannot modernise Napier house, but its capital funding from the Government has doubled in the last four years. Through economic benefits, it has raised £35 million in capital receipts from non-housing assets. The money was there to modernise that care home.
	I can also tell the hon. Lady that tonight in Newcastle another top manager has been appointed in the civic centre, at a cost of £130,000 a year. Top management costs in Newcastle have risen by £1 million a year since the Liberal Democrats took over. The use of consultants is on a spectacular scale, and probably runs to more than another £1 million a year, including the employment of consultants to operate the bulk of the council's internal audit service. That is a poor record, which shows that there is plenty of potential for dealing with those problems. Those matters must be addressed.

Bob Neill: Will the hon. Gentleman give way?

Jim Cousins: I am afraid that I cannot give way to Conservative Members, because I must conclude my remarks.
	I must also tell the hon. Lady that the Liberal council in Newcastle declared reserves of £100 million at the end of the last financial year. What was that money for, except a rainy day? According to her logic the rainy day has arrived, but the £100 million is in reserve. We must do better.
	We must come back next year and see where the Government have got to in recognising population change, in providing local authorities with an incentive to grow business, in funding schools and children's services, and in funding care. Again, I tell the hon. Lady that since the Liberal Democrats took over in Newcastle we have lost 1,000 children from our schools. Another 1,000 children go over the border each day to be educated in other authorities. We would have had an extra £8 million a year in our schools had it not been for the combined effect of that.
	For the moment, my hon. Friend is on notice in respect of what he must do in the next 12 months. I shall tell my constituents in Newcastle that in dealing with those issues through the local council we should freeze the cuts, the increases in top management, the use of consultants, and council tax for the next year. We should look closely at the council's reserves. Local and national Government are now under question. I ask questions of the local council and the Government tonight. Over the next year, we will seek to resolve those issues.

Robert Syms: I intend to make a few brief remarks about Poole borough council. It is an excellent, well-run council but it is 43rd out of the 46 unitary authorities when it comes to funding. Its formula funding per head is £191.95 whereas the average for unitary authorities is £376.96, nearly twice as much, and the highest is £603.31, which is three times as much. The authority is struggling and having great difficulty containing council tax because of all the burdens on it.
	We mentioned the concessionary transport scheme earlier. Poole loses out: there is a funding gap of some £500,000 in that scheme, which falls on the council tax payer. Poole has had to put an additional £1 million a quarter into services for older people, £481,000 into services for those with disabilities, and £91,000 into waste services. Equal pay is also a major issue for local government, and Poole council will probably have to put £500,000 into that. However, in the three years of the settlement, Poole's increases will be 2.2 per cent., 1.8 per cent. and 1.5 per cent. That is about half the increase announced earlier by the Minister.
	Nobody would expect Poole to be at the top of the table, or even necessarily in the middle of the table. The real concern for Poole borough council is the spread of funding between those at the top and those at the bottom. A lot of services cost the same anywhere, such as teachers' salaries and so on. That is putting real pressure on my constituents.
	The Minister said that the settlement is tight. It is a tight settlement nationally, but it is a very tight settlement for those authorities that are funded at similar levels to Poole borough council. Things will be very difficult over the next three years. Poole has brought in some very low council tax increases for two or three years, but it looks like this year the increase will have to be 4.9 per cent. That is a pity. Many of my constituents have assets in the form of homes but are income poor and struggle to pay the rising council tax bills. The Local Government Association pointed out the major costs that local authorities face this year, for example, social care and migration. It stated that, in its opinion, there was a £1.3 billion shortfall. As we have heard, specific taxes on local authorities, such as landfill tax—the £144 million that goes back to the Treasury—and the changes in court charges, will place a much larger burden on local government.
	My principal point is that I believe that my constituents are being unfairly treated. That applies not only to local government but police, fire and rescue and a range of other matters. Our outcomes are not too bad, but that is difficult to maintain against a general background of poor funding. I suspect that, to do the subject justice, I need to apply for an Adjournment debate, but I wanted to make those brief comments in the debate tonight.

Andrew Slaughter: I pay tribute to the Government for the increase in local government finance of 20 per cent. on average nationally that they have provided over 10 years and for the three-year settlement, which is welcome. It provides some certainty as well as scope for considerable growth over time. As my hon. Friend the Member for Newcastle upon Tyne, Central (Jim Cousins) said, it focuses the spotlight on the competence of not only central Government but local government. I shall please the hon. Member for Bromley and Chislehurst (Robert Neill) by using Hammersmith and Fulham as an example of the way in which councils can go off the rails.
	Before I do that, I cannot resist commenting on the remarks of the hon. Member for Falmouth and Camborne (Julia Goldsworthy). She related again the story of the magic money tree, in which the amount of money from central Government was too little, the council tax was too high and services were too stretched. Given all those parts of the equation, from where do Liberal Democrats expect the money to come, except out of taxpayers' pockets? It is always their way, but I thought that, given that they have had some experience of government locally, even though they have none nationally, they would be less naive in proposing such policies.
	In response to the interest that the hon. Member for Bromley and Chislehurst showed in what happens in west London, yes, it is possible to maintain and improve services while keeping council tax increases low, as was done under a Labour Government and a Labour council for nine years. As I said, the average increase in that time was 3 per cent. in council tax against 7 per cent. for London or nationally. Even with a tighter settlement, 3 per cent. efficiency savings and some difficulty, it should be possible to continue to protect council services. Yet, as I have said, the council cabinet in Hammersmith and Fulham will tonight agree £36 million of cuts. I doubt whether that figure will be equalled by any other local authority in the country. It is a rejection of the increases in funding that the Government have provided over years.
	That may not be as bad as it sounds because, when one examines the detail, £12 million is described as efficiencies from outsourcing. I am not sure what sort of bank loan one would get if one asked for £12 million on the basis of such a one-line comment. Every contract that has been let—a £10 million refuse contract is being let tonight—has come in over budget. The chances of achieving any of those savings is therefore slim. There is a figure of £2.5 million for savings from debt reduction. Yet only 25 per cent. of the asset sales have been achieved so far, against officer advice that many of the sales were to the detriment of the local authority. Perhaps that should be cause for a cheer because those cuts will not go ahead. However, because the budget is being set in a way that demands such cuts, those perhaps innocent-sounding cuts will now constitute further cuts in front-line services and services for vulnerable people.
	The authority had its comprehensive performance assessment almost a year ago. It has not been published because the authority is challenging, for the third time, its content, on the basis—I assume—that it is not happy with the findings. Last week, an arm's length management organisation in the authority was given one star, with poor prospects of improvement. If that is not turned around in the next year, decent homes money of tens of millions of pounds will be lost to council tenants.
	The overall effect for my constituents will include a 40 per cent. increase in meals on wheels charges; a 50 per cent. increase in parking charges in some areas; all charges, including rents, increasing by at least twice the rate of inflation; charges for recycling; a consultation on charging for home helps, despite an assurance to the contrary in the manifesto less than two years ago; the sale of assets from youth clubs, community centres, homeless hostels and secondary and primary schools; the closure of public toilets; the cutting of maintenance for pavements, again against officer advice; the cutting of the play schemes subsidy; the cutting of grants for school uniforms for poorer families, and for music and drama awards; the closure of reference and mobile libraries; an overall cut of up to 25 per cent. in voluntary sector budgets; the withdrawal of home help services for 1,400 people; and the sacking of 166 home helps. In addition, concierge services on housing estates will be reduced and residential caretaker services ended, even though they are the main measures that control crime and antisocial behaviour on estates, and there will be a 5 per cent. year-on-year cut in the housing revenue account budget.
	I appreciate that such levels of cuts—or abominations—are not typical even of Conservative authorities; all that I would say to the Opposition is that if they wish to disown them, they now have an opportunity to do so. If they wish to associate themselves with those cuts, that will be the sort of standard in public services expected of them if they ever get back into government.

Alistair Burt: I congratulate my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) on his performance at the Dispatch Box in opening for our side and on dealing so ably with such a cunning fox on the other side. The Minister is a good man and handles his brief incredibly well, but his cunningness is such that he was able to carry off with great insouciance some of the things that he had to say, which my hon. Friend picked up so well.
	To use a football analogy that will be familiar to one or two hon. Friends, when a defender has ruthlessly cut down the forward running through and committed the most atrocious foul, he protests to the referee with the grandest of gestures, claiming that it could be nothing to do with him. When the Minister talks about a tight financial settlement as if it were an act of God and not the responsibility of the Government, who have spent a colossal amount over the past 10 years and are now having to pull the horns in, it is the political equivalent of spreading one's arms out to the referee and saying, "Nothing to do with me, guv," but we know that it is. That is what my hon. Friend spotted, and I look forward to his contributions on the subject for some time to come. I am glad that he is there and I am not.
	The settlement is wrong for two reasons. First, it is disingenuous. The general public understand inflation and think that if a council gets more than inflation, everything must be all right and that the money should be coming through effectively, but with the rise of 1 per cent. above inflation or whatever it is, the Government are giving the public the sense that, should there be any rises or cuts in services, they must be the council's fault. However, the Minister knows full well—this has been well documented by hon. Members in all parts of the House—that the cost pressures in local government in some areas go well beyond 1 per cent. or whatever the gentle increase above inflation represented by the three-year settlement is.
	Social services have been mentioned, and they include not only care for the elderly, but special needs care for the youngest. Fortunately, more young children with complex and special needs now survive infancy. The cost of that generation as it grows is substantial and mirrors the cost at the other end of life, when those who are fortunate to be living longer have a greater need for more expensive care. These pressures have not yet been fully compensated for in the settlement, and it will be some time before they are.
	Colleagues have mentioned waste and highways. Some local examples from Bedfordshire will illustrate the disingenuousness. I pay tribute to the three local authorities in Bedfordshire with which I have close dealings, but they are coming to an end, because of local government reorganisation. The Conservatives have run two of them and been the majority party on the other, and all three have done remarkable things over the years. Bedfordshire county council has moved from having a rating of no stars to three in less than two years. Mid-Bedfordshire district council gets consistently good ratings for its local government performance, and Bedford borough council, on which Conservatives are in the majority, is rated an excellent council.
	I pay tribute to those councils in passing, but each of them can provide an example of the difficulties that the settlement will produce. In regard to social services care for the county, there is the floor issue. For the third consecutive year, the county council will lose money. Being a floored authority has cost it £5.8 million, which has put £39 on the council tax. The local authority business growth incentives scheme—LABGI—will also cost it money.
	Bedford borough council reports that the next three years' increase in the amount given for the concessionary fares scheme has been calculated by the Government at £450,000, £460,000 and £470,000. The extra £10,000 a year hardly covers inflation increases, and does not say much for the anticipated increase in the numbers of people using the buses. Two or three years ago, Mid-Bedfordshire district council was rate-capped for having the audacity to raise its band D council tax by £1 per month. The hon. Member for Wigan (Mr. Turner) will understand this. It is now trying to provide weekly waste collections and to do the recycling that the Government want it to do, but it is not getting the support that it needs and will be in difficulty.
	My first charge is that this is a disingenuous settlement, and that it will not deliver what the public expect. We could have seen better. The second thing that is wrong with it is that it does not take the opportunity given to it by the three-year change of delivering one of the things that Lyons spoke of, and that my right hon. Friend the Member for Skipton and Ripon (Mr. Curry) mentioned. It could have taken the opportunity to cut through the question of who is responsible for the increases and what the respective responsibilities of the Government and the local authorities are.
	Many of the contributions tonight have dealt with that dilemma. Colleagues have tried to say that, if the Government are responsible for one thing, the local council must be responsible for another. The Government just sit and let the blame be passed on. The Lyons report said that
	"an independent and authoritative voice is needed to provide better information on funding to inform the public and parliament about the impact of new burdens on local government and the evidence of future pressures".
	Lyons could see that the confusion between the responsibilities of the Government and of local government was eating away at the public's understanding of local government and of where responsibility for public finance lay. That is reducing the public's confidence. If all they ever see of national and local politicians is an endless passing of the buck, they will end up saying, "A plague on both your houses."
	The need for greater transparency is something that we have all recognised in the past few days in another context. The Government could have taken this opportunity to do what Lyons suggested, and to put in place a mechanism to provide that independent voice and to look authoritatively at the responsibilities of local government and of Parliament and central Government, and at the future pressures. The Government need to answer the conundrum by asking where fault and responsibility lie, and who should be credited with certain changes. That would address the serious issue that is affecting the heart of local government and people's relationship with it.
	The Minister is a fair man who is interested in these issues. I think that he heard me speak on this subject at the local government finance conference in December. I truly would like to see the Government take away that suggestion in the Lyons report and do something with it. If they did so, we would not have to deal with a disingenuous settlement in future. Instead, we would be dealing with a measure that met the concerns of colleagues on both sides of the House. We would have an honest and authoritative arrangement in which we could attach blame where blame truly lay, and in which credit could be given where it was rightly due. That would provide better settlements in the future, and I hope that the Minister will address that point. I hope that those on our side will also do so in due course.

John Healey: It would be fair to say and would be acknowledged that I gave way a great deal during my opening speech and answered many of the pressing questions put by hon. Members on both sides of the House. It would also be true to say that all Members from all parties have worked closely with their councils and raised strong concerns in their contributions to the debate. Some speak with significant experience of local government and central Government finances—

Eric Pickles: Will the Minister give way?

John Healey: At this stage, given that I gave way so much earlier, I shall not.
	I was talking about hon. Members with significant experience, and they include my hon. Friends the Members for Leeds, East (Mr. Mudie), for Wigan (Mr. Turner), for Newcastle upon Tyne, Central (Jim Cousins) and for Ealing, Acton and Shepherd's Bush (Mr. Slaughter). It is also true that some Opposition Members speak with the same significant experience, including the right hon. Member for Skipton and Ripon (Mr. Curry), and the hon. Members for Bromley and Chislehurst (Robert Neill) and for North-East Bedfordshire (Alistair Burt). We have heard some reflective contributions in a good if slightly short debate.
	My experience of seven or eight months of doing this job and being in the position to take decisions on how to distribute £27.5 billion suggests that almost every one of the 456 authorities in England feels that it has a special case and that it has in some way been uniquely disadvantaged by previous Government decisions. It is also the case that doing this job is not generally likely to win one many friends. However, let me read out to the House brief excerpts from two representations that I received during the consultation—in total, 340 representations were received from 246 authorities and organisations.
	The first said that the settlement in December
	"turned out to be a pleasant surprise for the... Council... We felt it only right and proper to write and say thank you for your work and your decisions this time".
	The second said:
	"We all know resources are significantly constrained under CSR07 settlement... That is why it was crucial to ensure that how the resources allocated to local government were suitably sub-allocated to individual authorities was done fairly. I believe you have got that allocation in the form of the provisional settlement broadly right",
	which is why the letter was written to "express thanks" to the Department. The first came from the Labour leader of Lancashire council and the second from the Tory leader of Kent council. I say to the hon. Member for Bromley and Chislehurst that it could not be clearer that that gives the lie to any accusations that this settlement is somehow riddled with geographical or political bias.
	I also have to tell the hon. Gentleman that it does local government a disservice when he dismisses it, saying that people are getting less from more funding for local government. The latest Audit Commission figures show that four out of five councils—up from two thirds a year ago—are rated either good or excellent. They show that nine out of 10 councils provide good value for money and that where more than half of people are satisfied with their council, they rightly expect it to save money. In doing so, councils must show that they have maintained or improved local services in order to count any of their savings as efficiencies.
	My hon. Friend the Member for Wigan chairs the all-party SIGOMA—special interest group of municipal authorities—and I welcome his welcome for the settlement. I thought that, by and large, he made a balanced speech. He was right that the settlement means that those with the greatest needs will get the resources. He also reminded us of the experience of local government under the previous Conservative Government—four years of real cuts under the Tories running up to 1997 have been followed by 10 years of above-inflation rises.
	This settlement and those increases, combined with tough capping action, have helped bring down council tax increases, and, following its introduction in 1993, three of the four lowest rises in council tax have occurred in the past four years.
	We will not hesitate to use our capping powers to protect taxpayers from excessive increases, but this is a settlement for three years. It provides greater flexibility and more resources, and is backed by more than a third of a billion pounds to help councils improve, innovate and cut inefficiency. Responsibility for delivering the settlement now rests with councils. I commend the settlement and the report to the House.

Question put:—
	 The House divided: Ayes 278, Noes 45.

Question accordingly agreed to.
	 Resolved,
	That the Local Government Finance Report (England) 2008-09 (House of Commons Paper No. 262), which was laid before this House on 24th January, be approved.

DELEGATED LEGISLATION

Northern Ireland

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),
	That the draft Northern Ireland Arms Decommissioning Act 1997 (Amnesty Period) Order 2008, which was laid before this House on 4th December, be approved. —[Mr. Roy.]
	 Question agreed to.

MODERNISATION OF THE HOUSE

Ordered,
	That Mr Adrian Sanders be discharged from the Select Committee on Modernisation of the House of Commons and John Hemming be added. —[Mr. Nicholas Brown.]

COMMITTEES

Mr. Speaker: We shall take the next three motions together.
	 Ordered,

Justice

That Mr Humfrey Malins be discharged from the Justice Committee and Mr Andrew Turner be added.

Scottish Affairs

That Mr David Hamilton be discharged from the Scottish Affairs Committee and Mr Jim McGovern be added.

Administration

That Frank Dobson be discharged from the Administration Committee and Mr Tom Clarke be added. —[Rosemary McKenna, on behalf of the Committee of Selection.]

HMP CHELMSFORD

Motion made, and Question proposed, That this House do now adjourn. —[Mr. Roy.]

Simon Burns: I am grateful for the opportunity to raise the subject of the report by Her Majesty's inspector of prisons on Chelmsford prison on the Adjournment, given that it came out only last week. I hope that the Minister agrees that the report raised some important issues that need to be addressed as a matter of urgency. That is why I sought this debate.
	Chelmsford prison is a Category B male local prison with a certified accommodation level of 570 prisoners, but it suffers from overcrowding, with an actual number held of around 680 to 690 prisoners. Prison officers do an excellent job in very difficult circumstances, given the strains and tensions placed on the prison by the number of prisoners held there.
	Over the past 10 years the prison has been inspected several times by Her Majesty's inspector of prisons, in both announced and unannounced inspections that have highlighted several problems. As a result, I am pleased to say, measures were taken to seek to rectify those problems. That is why it is so worrying that the latest report, following an announced inspection on 9 to 13 July last year, has highlighted so many serious problems. To add to the confusion, the annual report by the independent monitoring board at HMP Chelmsford for 2007, which in part covers the period of the HMI report, paints a far more positive picture of what is going on in the prison. I should be grateful if the Minister would comment on why there are some fundamental differences between the two reports, and say which report portrays a more accurate assessment of the situation.
	The most worrying problem that has emerged is the number of suicides in the prison. Until the end of 2006 there was one suicide a year. That is one suicide too many, but one can be heartened that the rate was below the national average for suicides in prisons. However, since May last year there have been four suicides in the prison. That is a deeply disturbing increase. I appreciate that it is difficult for the Minister or others to comment on the cases because inquests have not yet been held on all the suicides, but does the Minister have any idea why there has been such a dramatic and tragic increase in the number of suicides in the prison over the last 10 months, compared with the prison's previous record?
	The HMI report was damning on the subject of bullying, self-harm and suicide. Section 3 of the report states that everyone inside a prison should feel safe from bullying and victimisation. However, section 3.1 states that:
	"A significant number of prisoners felt unsafe at Chelmsford. Bullying was a serious problem among the young adult population."
	Ann Owers stated that some 40 per cent. of prisoners felt unsafe at the time of the inspection, which is a staggeringly high proportion. Although an anti-bullying co-ordinator had been appointed, and the procedure for identifying bullying had been improved, she goes on to say that
	"there was still some under-reporting of incidents. Improvement targets for bullies were weak...and arrangements for victims were poor."
	On the subject of self-harm and suicide, the report states that the expected outcomes should be that
	"Prisons work to reduce the risks of self-harm and suicide...Prisoners at risk...are identified and a care and support plan is drawn up, implemented and monitored."
	However, section 3.18 of the report says:
	"Despite previous recommendations, Listeners and Insiders were not available in reception...Overall access to Listeners was generally poor. Initial self-harm monitoring assessor reports lacked detail, and there were insufficient monitoring entries that demonstrated positive engagement by staff."
	Will the Minister explain why previous recommendations concerning listeners were not implemented at the time, and what has now been done to ensure that the prison follows best practice?
	Will the Minister also explain why, following the suicide in October 2006 of a prisoner who had been placed directly on C wing because of overcrowding, and when the ombudsman had recommended after his investigation that listeners and insiders should be available in reception, the proposal was once again rejected by the establishment? Given what has happened since, it is important that we are told exactly why that recommendation was rejected at the time. Can the Minister confirm that implementation of the recommendation, which took place during the most recent inspection, is continuing?
	Will the Minister outline what is being done to implement the report's recommendations for minimising opportunities to self-harm and commit suicide? The recommendations were, first, to improve the quality of initial assessment, care in custody and teamwork—ACCT—reports; secondly, that staff monitoring entries in ACCT documents should demonstrate a high level of engagement with the prisoner; thirdly, that prisoners were to have 24-hour access to listeners, and, fourthly, that CCTV should not be used as an alternative to observation of and engagement with prisoners at risk of self-harm.
	I am slightly confused, however, because section 9 of the independent monitoring report, which deals with the issue of safer custody, portrays a slightly different assessment of the situation from that given in the HMI report. I accept that the HMI report went into much greater detail about self-harm and suicide, but the independent monitoring report is far more positive, and less critical, than the HMI report about what was going on during the same period. The independent monitoring report covers the whole of 2007 whereas the HMI report is a snapshot of a four-day period in July 2007, but would the Minister care to give an opinion as to why the two reports seem on the face of it to be sending out different messages about a critical point, given what has happened in the prison over the past year?
	I am sure the Minister agrees that everything possible must be done to minimise the opportunities for self-harm and suicide among prisoners. Will she assure me that everything will be done to implement recommendations in the report that have not already been acted on, to ensure that Chelmsford prison is safer and enjoys the most sophisticated best practice so that we can put an end to the ever-increasing number of suicides?
	I appreciate that a number of factors have contributed to the situation highlighted in the report. One is overcrowding. Given the pressures on our prisons at present and the time it takes to find extra capacity in the system, I accept that we cannot reverse the overcrowding problem immediately. However, in view of the pressures on staff and the tension in the prisoner population caused by overcrowding, what can be done to try to alleviate the problem on a short-term basis until a longer-term solution can, we hope, reduce overcrowding and return the prison to the situation of about seven or eight years ago?
	I have a further plea to make to the Minister. The independent monitoring report requests a response from her on its recommendation that the time that elapses between a death in custody and the holding of an inquest should be speeded up. Although the report accepts that steps have been taken to try to reduce the time between deaths in custody and inquests, the writers felt that nothing had actually happened to reduce the time, so I urge the Minister to address the problem. Does she have any ideas or recommendations as to how one might expedite the process so that inquests are heard far nearer to the time when the tragedy occurs? That would be in the best interests of the system as a whole: it would help to give closure to the parents, families and friends of those who die so tragically, and it could also help to identify precisely what went wrong in individual cases, and what recommendations could be made to try to ensure that no tragedy occurred again as a result of whatever cause led to the suicide in question.
	I should like briefly to touch on another area highlighted by the HMI report: education and employment in the prison. I personally believe that prison serves two purposes: punishment for the individual and, equally importantly, an opportunity for rehabilitation. However, rehabilitation can be achieved only if prisoners reach a certain level of education. The HMI report shows that nearly a third of people in Chelmsford prison had been unemployed and a further third had been involved in activities that provided no skills or qualifications. It is critical, to assist with rehabilitation and minimise reoffending rates, that levels of literacy and education be raised among prisoners. That will give those prisoners a golden opportunity to make a fresh start on release and to minimise their opportunities to reoffend. They will have gained a level of literacy and education that not only incentivises them to try to find employment but makes them more attractive to employers, so that in the very difficult circumstances of released prisoners, they can secure jobs.
	In that respect, Chelmsford prison has been extremely fortunate, because it has benefited from the work of Jackie Hewitt Main, who has created the Mentoring 4 You programme. Using research on the prisoners, she has identified that a significant number of them suffer from dyslexia, which is, of course, the root of a great deal of illiteracy in the prison system and, for that matter, outside the prison system. She has established a programme in which other prisoners are engaged to help prisoners who suffer from dyslexia and dyspraxia to overcome or minimise their literacy problems. It is an exciting and potentially very beneficial programme, but like many other good ideas, it suffers from funding problems.
	I urge the Minister to liaise with her colleague the Under-Secretary of State for Innovation, Universities and Skills, the hon. Member for Tottenham (Mr. Lammy) —I hope to do so, too, personally if I can secure a meeting with him. He is responsible for the funding of such programmes in our prison system, and we could try to persuade his Department to provide funding for that imaginative and important scheme. I also urge her to study the reports that have been conducted on the Mentoring 4 You programme in Chelmsford prison, because they are very positive and hopeful. If she were to agree with my analysis, and that of Ofsted, that the project is positive and worth while, she should consider rolling out the programme to other prisons, so that other prisoners can benefit from that sort of programme and enjoy the same benefits as those enjoyed by prisoners in Chelmsford prison. That will help to enable prisoners with dyslexia and dyspraxia to reduce their illiteracy and give them an opportunity to take positive steps forward, so that when they are released there is the beneficial impact of minimising the likelihood of their reoffending.
	In conclusion, I believe that the HMI report has highlighted some important problems and issues at Chelmsford prison, especially given the suicides in the prison in the past nine months. We must move forward; we must ensure that best practice is employed and that everything is done to minimise a repetition of what happened. We must never lose sight of the fact that the management and prison officers are doing an extremely good job, often in difficult circumstances. We must give them the support and assistance to rectify the problems highlighted in the report, so that when Her Majesty's inspectorate of prisons revisits the prison, it sees serious improvements in the regime.
	We can talk for as long as we like about the problems and how to identify them, but what is important is getting solutions. We have to make sure that talk leads to action, and that we ensure a better, safer environment not only for prisoners but for prison officers, so that they can carry out their job and serve society.

Maria Eagle: I congratulate the hon. Member for West Chelmsford (Mr. Burns) on securing the debate. He is well-known for taking an interest in the prison in his constituency. I thank him for that, because visiting prisons and making sure that one is fully aware of what goes on in them is not top of every hon. Member's list. However, it clearly is close to the top of his list, and I congratulate him on that.
	The hon. Gentleman set out in some detail the findings of the report on the inspection that Her Majesty's inspectorate of prisons carried out between 9 and 13 July 2007. The report was published on 24 January this year. It made more than 150 recommendations and, as is the case with all inspection reports by the inspectorate, an action plan will be produced that responds in detail to every one of the recommendations. The action plan will be provided to the chief inspector of prisons and I will approve it. The chief inspector acknowledged in her recent annual report that the Prison Service responds positively to her reports and accepts over 95 per cent. of her recommendations. We are determined that, as we follow the processes, the correct lessons will be learned, and the correct actions taken.
	I can report that there has been progress. The chief inspector's report was published only recently, but the inspection took place six months ago, and the Prison Service and Chelmsford have been getting on with trying to implement her recommendations and dealing with the issues that she rightly raised. A good deal more progress is in the pipeline. In view of the concerns that the chief inspector listed, and which the hon. Gentleman has repeated, I think that it would be appropriate for me to highlight some of the things that have been done to carry out the chief inspector's recommendations. In cataloguing the progress made, I do not seek to downplay in any way the seriousness of her findings. I hope that the hon. Gentleman will bear in mind that we fully intend to continue to bear down on the faults that she identified.
	The prison is coming to the end of a new building and refurbishment project that has provided a 120-bed unit and workshops for brickwork, woodwork, plumbing and electrical work. It also provides additional classroom space, and there is IT-based learning through Learn Direct. An extension to the gymnasium facilities is nearing completion. The extension will provide additional purposeful activity spaces and includes a new shower area. After numerous surveys, the governor believes that a solution to the problem of not being able to provide showers consistently on B and C wings has been found, and work is to start shortly to improve the water pressure on those Victorian wings. That should do something to improve the situation and end some of the problems that the chief inspector highlighted.
	There is no doubt that the standard of accommodation varies widely across the establishment. New wings are coming into use, but there are inherent difficulties with some of the Victorian wings, which it is impossible to remove. We have to do what we can with them.
	The prison has reviewed the processes in reception, which has resulted in newly received prisoners spending less time in the area, and being moved to the first-night centre to complete the process. The centre provides a better environment for staff and prisoners to complete risk assessments and medical documentation.
	Listeners and insiders are used regularly in reception, but because less time is spent in reception, the need is met predominantly in the first-night centre. There are 12 listeners, who have been trained by the Samaritans, and the prison also uses insiders— experienced prisoners who receive training and provide valuable support in the first-night centre, where they interview all new receptions, and offer advice and support at peer level.
	The anti-bullying policy has been reviewed, and staff and prisoners are fully aware of the processes. The prison has introduced prisoner wing anti-bullying representatives—trusted and experienced prisoners who can help staff in identification of, and support for, prisoners who are subject to acts of bullying. That has provided an opportunity for victims of bullying to report safely and freely any such acts, allowing them to be dealt with in a timely and efficient manner.
	Since the inspection, the location for vulnerable prisoners has been changed from the Victorian D wing to the new G wing, which provides the vulnerable prisoner population with a safer environment, where main prisoner moves do not affect the regime of those on the unit. Young offenders have been moved from C wing and integrated across the establishment, which has allowed the prison to manage the more volatile, gang-related culture in a more holistic manner. The area manager is seeking to reduce the young offender population, which has recently risen. Two thirds of the population are from out of the area, the majority of them from London.
	The prison has looked at the use of control and restraint, and it has introduced a use of force review, in which the governor, the head of operations, the safer custody manager, the control and restraint instructor, and a representative of the Prison Officers Association meet to review the previous month's incidents. Since the inspection, there has been a marked reduction, I am happy to say, in instances of control and restraint, adjudications, and the use of special accommodation and body belts, which were mentioned by the inspector in her report. In fact, body belts have not been used in the past six months, and special accommodation usage has also reduced by 55 per cent. in that period.
	At the time of the inspection, staffing was a major problem, and the establishment had a shortfall of about 25 officers at the end of August. I am pleased to report that, as a result of a major recruitment drive, the prison is in a much more stable position, with a much more manageable shortfall of six officers, and it should be up to complement by March.
	Key to the prison's response to the chief inspector's report and the implementation of her recommendations is the staff response. The hon. Gentleman was right to say what a great job the staff do, and how difficult it can be. I acknowledge the truth of what he says. Like him, I wish to place on record the Government's thanks for the efforts of staff at all levels. He referred to individuals who have done outstanding work, which he has seen on his visits, but they all do a good job, often in trying circumstances.
	One way in which prison management can determine staff morale is to look at the number of staff who engage in the annual survey. I am pleased to be able to report that the number of staff taking part in the survey rose from 26 per cent. to 65 per cent. last year, indicating a greater engagement. People think that it is useful to fill in the survey, so it is a good pointer to improved morale. The governor is right to believe that morale is improving and that staff want to be involved in taking the prison forward.
	In the remaining time, I wish to deal with specific points made by the hon. Gentleman. He rightly raised the issue of self-inflicted deaths in custody, particularly the three deaths in six weeks at Chelmsford. I should say at the outset that every death in prison affects families, staff and other prisoners deeply. Ministers and the Prison Service are completely committed to reducing the number of such tragic incidents. Following the most recent death on 8 January, the Prison Service undertook an immediate review of systems and practices around suicide and self-harm at Chelmsford. The key findings were that staff across all the areas in the prison that were visited were knowledgeable about safer custody issues, and motivated to provide a good level of care; and that the reception was well run, although a number of suggestions have been made about its general layout and the provision of resources such as health care and listeners, and the further identification of high-risk groups.
	Assessment, care in custody and teamwork documents, the care planning system for prisoners at risk of suicide or self-harm, were of a good quality overall. There were common areas for development, including an overlap between the assessor and the case manager role, a lack of clarity in the required frequency of conversations and observations, and the recording of those.
	Before the review, we were all aware that the four most recent self-inflicted deaths, dating back to May 2007, happened on different wings and at varying times of the day and involved a mixture of sentenced and unsentenced prisoners who had been at Chelmsford for varying lengths of time. There seemed to be no particular, discernible pattern. Thankfully, the review has highlighted no extra issues that might indicate a disturbing institutional problem. Staff at the prison are obviously very concerned and distressed at the spate of recent deaths and will continue to take that aspect of their work extremely seriously. There are numerous examples of groups of close-together deaths at various establishments, and they always have a traumatic effect. It is right for us to seek to learn every possible lesson to minimise such activity.
	The hon. Gentleman made some points about outstanding inquests. Five inquests relating to deaths at Chelmsford are currently outstanding. The earliest case involved a death in October 2006. One of the issues is that the Prison Service's and probation service's ombudsman has to produce his report before the inquest can go ahead. The report on that case was received in October 2007. The inquest is scheduled for May 2008. The coroner is awaiting reports on the other four deaths; that is often one of the things that holds up inquests. We need the inquests to be carried out as swiftly as possible for the benefit of all—not only for the deceased's family, for whom it is a very distressing time, but for staff and other prisoners, so that any lessons can be learned. We encourage the speediest possible process, so that the inquest can go ahead as quickly as is commensurate with proper investigation.
	The hon. Gentleman mentioned differences that he perceived in tone and outcome between the chief inspector of prison's report and the independent monitoring board report. We have only just received the IMB report and I have not yet had the chance to respond properly to it. However, I can say that the chief inspector of prisons and the IMB are independent and entitled to report as they see fit. The main difference between the two is that the IMB sees the prison operating day in, day out and goes in frequently to work alongside staff and prisoners. Naturally, its members develop an affinity for the establishment. Perhaps it is rather different for the chief inspector, who goes in for a few days to form a view to base her report on. She also goes to other establishments and so can compare and contrast. All I can say is that I guess they look at a prison from slightly different angles. I certainly intend to answer fully the questions raised for my attention in respect of the IMB report.
	The hon. Gentleman asked what is being done to implement recommendations to minimise the opportunities for self-harm and suicide, and I have said a little about that already. We certainly intend to bear down on that issue, which was raised in both reports. It gives some clue on why there has been such a spate of self-harm. As the hon. Gentleman acknowledged, such things are not easy to pin down. However, there is no doubt that we are fully committed at the establishment and Government levels, and with others, to try to make sure that we minimise the incidence of self-harm and suicide. We need to focus on that particularly, given what has recently occurred at Chelmsford—
	 The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Deputy Speaker  adjourned the House without Question put, pursuant to the Standing Order.
	 Adjourned at sixteen minutes to Eleven o'clock.